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Effect of Transaction Costs on Marketing of Small Scale Maize Farming in Limpopo Province

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  • Majory Meliko

Abstract

The deregulated and highly competitive nature of current South African markets has created new barriers for capital-poor emerging farmers. Many of these barriers are related to the cost of transacting. A linear regression model and a Multinomial logit regression model were used to predict the hypotheses that transaction costs affect the quantity sold and that factors that affect transaction cost affects market integration respectively on farmers who produce maize. From the analysis, road access, membership in a marketing institution, land size, unit price and ownership of irrigation technology affects the quantity of maize sold. While the nature of the road (P-value, 0.043) and knowledge of price (p-value, 0.000) were the two factors affecting market integration. A possible solution for the problem is the establishment of an information and communication technology centre for price dissemination and produce aggregation.

Suggested Citation

  • Majory Meliko, 2014. "Effect of Transaction Costs on Marketing of Small Scale Maize Farming in Limpopo Province," Journal of Agricultural Science, Canadian Center of Science and Education, vol. 6(6), pages 108-108, May.
    • Handle: RePEc:ibn:jasjnl:v:6:y:2014:i:6:p:108
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    References listed on IDEAS

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    1. Jayne, T.S. & Hajek, Milan & Zyl, Johan van, 1995. "An Analysis of Alternative Maize Marketing Policies in South Africa," Staff Paper Series 201199, Michigan State University, Department of Agricultural, Food, and Resource Economics.
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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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