Technical efficiency and technology gap in Kenya’s tea industry: accounting for farm heterogeneity

ABSTRACT

The study used a cross-county survey from Kenya to investigate smallholder tea farmers’ performance using a stochastic metafrontier framework. According to the results, farmers in all four regions are falling short of their potential with the mean technical efficiency ranging from 0.69, 0.77, 0.61, and 0.74, respectively, for the Nandi, Mau, Kisii, and Kericho regions. Comparing its performance with the technology available in the industry, each region faces a technology gap. Even though some variables were not statistically significant, a combination of socioeconomic and farm-specific factors were identified as sources of technical inefficiency among farmers. The farmers in all regions, however, possess the potential to overcome technological constraints and achieve higher levels of productivity. Kenya Tea Development Agency Ltd should, therefore, enhance its efforts to help the farmers improve their management and technical skills on how to use their resources more efficiently.

KEYWORDS:

• Technical efficiency
• technology gap ratio
• metafrontier production
• Kenya tea industry

Acknowledgements

The authors are grateful to smallholder tea farmers in the main tea-producing agro-ecological zones for their overall cooperation in data collection.

Disclosure statement

The authors declare no conflict of interests.

Availability of data and materials

The data that support the findings of this study are available from the corresponding author upon reasonable request.

Author’s contributions

All authors contributed to writing and approved this manuscript to be published.

Additional information

Notes on contributors

Vincent Ngeno

Vincent Ngeno In his current role, Vincent Ngeno teaches and researches at Moi University, Kenya. He is an agricultural economist by training, holding a doctorate in Agricultural Economics and Resource Management. The majority of his research focuses on efficiency and productivity analysis, impact evaluation methods, food and nutrition security, and agri-environmental impacts. As well as conducting research, he teaches advanced econometrics and microeconomics.