The Impact of Increasing Input Costs to the Farmers in Cotton Production in Tanzania

Abstract

The persistence of increasing input costs has effects to the farmers in the process of cotton production. These input costs can be in terms of pesticides, seeds, fertilizers, sprayers and the like, that have a real contribution towards cotton outputs per hectare. This paper intended to analyze effects of increasing input costs to the cotton farmers in Tanzania. The primary data were collected through questionnaires, which were distributed to 35 respondents, who are knowledgeable enough about cotton production in Shinyanga-Bariadi. Secondary data were collected from the Tanzania Cotton Board, Ukiliguru Agriculture Training Institute and Shinyanga Regional Commissioners. A log-linear model was estimated by using Panel data method consisting of 24 observations from Mwanza-Misungwi and Shinyanga-Bariadi from 2003 to 2014. The Hausman test was applied to evaluate the fixed effect and random effect by using STATA 11 and EXCEL. The elasticity for every variable was computed to evaluate how a change in input price might increase or decrease the costs to the cotton farmers in Tanzania.