Agricultural decision- making: the case of pyrethrum production in Makete district

Beginning the 1970s, the agricultural sector in Tanzania has been facing deep-seated problems of growth. The explanation for the declining production of the export crops has most often been sought in terms of economic (material) incentives, especially the producer prices. Despite the government's efforts to increase the producer prices, there has been a decline in the production of almost all export crops. This suggests that the farmers' choice of crops and production levels is seldomly motivated by the level of the producer prices alone. This study aimed at investigating the factors that influence the farmer s choice of crops. This is necessary in order to understand the underlying causes for the fall in the production of pyrethrum. The aims, objectives of the study, together with the background information on pyrethrum production in Tanzania are discussed in chapter 1. Chapter 2 covers the literature review and the theoretical background of the decision making process among peasants. The literature cited reveal that apart from the economic factors the choice of crops is influenced by socio-cultural and personal factors of the farmers. Among these factors' the feeling of security in terms of food production is uppermost in the farmers' minds. Chapter 3 deals with the agricultural system of Makete District. In this chapter, aspects such as land tenure systems, agricultural technology, source and supply of labour, and the impact of the villagization programme on pyrethrum production are discussed. Chapter 4 concentrates on the agricultural price policy in Tanzania and pays special emphasis on the evolution of the producer prices. Three hypotheses are formulated for testing. It is postulated that due to emerging problems of land shortage and labour constraints, the smallholder producers in Makete District have changed their crop preference in favour of the food crops. Second, the production of pyrethrum has declined because of its cash returns to manday of labour input are lower compared to those of the food crops. It is also postulated that, the farmers' socio-cultural and personal factors - age, division of labour according to sex and the feeling of security have an influence on the choice of crops. In order to a general view of the factors that influence the choice of crops, the point-score method is used. Farmers were presented with a list of pre-selected decision factors in a random order. Then they were asked to indicate how important these decisions were in the choice of a particular crop. A more detailed method (chi-square) is used to test the statistical relationship between the farmers' socio-personal factors and the choice of the main crop. This is covered in chapter 5 (analysis). Through testing the hypotheses, it has found that, due to the high vulnerability of the traditional agriculture, the choice of crops is to a greater extent influenced by the "quest for security". Consequently risk aversion takes precedence over profit maximization. While it is evident that the producer prices have an influence in the farmers' decision - making process, most of them feel that the production for the market is a source of additional risks. This is in terms of low level of the producer prices poor supply of inputs; and the inefficient marketing and transport systems. In its conclusion (chapter 6), this study discusses the peasants' response to these institutional uncertainties. The peasants are increasingly withdrawing from the cash economy to the production of food crops for subsistence needs. This is being accelerated by the problems of land shortage and labour constraints. Therefore, this study explains the fall in the production of pyrethrum in terms of conflicting interests of the state on one hand, and the peasants on the other. While the state relies on the peasants for the production of agricultural surplus, the latter feel that their involvement in the cash economy is a source of additional risks. Therefore the peasants' concentration on the food crops is a rational choice towards ensuring themselves of food security.