IMPACT OF COMMUNITY MANAGED IRRIGATION ON FARM

PRODUCTION EFFICEICY AND HOUSEHOLD INCOME: THE CASES

OF WELISO AND WENCHI DISTRICTS OF OROMIYA REGIONAL
STATE

M.Sc. Thesis

Desta Beyera Sefera

December 2004
Alemaya University
 IMPACT OF COMMUNITY MANAGED IRRIGATION ON FARM
PRODUCTION EFFICEICY AND HOUSEHOLD INCOME: THE CASES
OF WELISO AND WENCHI DISTRICTS OF OROMIYA REGIONAL
STATE

A Thesis Submitted to Department of Agricultural Economics

School of Graduate Studies
ALEMAYA UNIVERSITY (AU)

In Partial Fulfillment of the Requirements for the Degree of

MASTER OF SCIENCE IN AGRICULTURAL ECONOMICS

By
Desta Beyera Sefera

DECEMBER 2004
Alemaya University
 DEDICATION

This thesis manuscript is dedicated to my late brothers, KEBEDE and

TEFERA BEYERA, whom I lost in the years 2000 and 2004.

ii
 STATEMENT OF THE AUTHOR

First I declare that this thesis is my bonafide work and that all sources of materials used for
this thesis have been duly acknowledged. This thesis has been submitted in partial
fulfillment of the requirements for an advanced (M.Sc.) degree at the Alemaya University
and is deposited at the University Library to be made available to borrowers under rules of
the Library. I solemnly declare that this thesis is not submitted to any other institution
anywhere for the award of any academic degree, diploma, or certificate.

Brief quotations from this thesis are allowable without special permission provided that
accurate acknowledgement of source is made. Request for permission for extended
quotation from or reproduction of this manuscript in whole or in part may be granted by
the head of the major department or the Dean of the School of Graduate Studies when in
his or her judgment the proposed use of the material is in the interests of scholarship. In all
other instances, however, permission must be obtained from the author.

Name Desta Beyera Sefera Signature:………………………………

Place: Alemaya University, Alemaya
Date of submission: …………………………..

iii
 BIOGRAPHICAL SKETCH

The author was born at Waliso district, Southwest Shewa Zone of Oromiya Regional State, on

October 11, 1963, from his mother Addee Feleku Ate`u and his father Obboo Beyera Sefera. He

attended his elementary education at Woliso Ras Gobena Dachew Abba Tigu elementary

school. After completion of elementary education, he then joined Dejazmach Geresu Duki

Comprehensive secondary school in the same town and completed high school education in

May1980. In the same year he joined the then Alemaya College of Agriculture, now Alemaya

University, and graduated with B.Sc. degree in Animal Sciences on July 1984.

Right after graduation in 1984, he was employed in Ministy of Agriculture and assigned at

Wellega Administrative Zone where he worked at Ghimbi and Assosa Awrajas of the zone at

different levels of responsibilities. In 1988, he was promoted to the zonal level and assigned at

Kefa Administrative Zone office of Agriculture at a position of Senior Expert of Livestock and

Fisheries development. In 1989, with the movement of the zonal office, he moved to Mizan

Teferi with the same level and responsibilities.

In 1991, following the falling down of the Derg government, he got a transfer to West Shewa

Zone Department Of Agriculture and worked as Senior Expert in Animal Husbandry and

Coordinator of Dairy Rehabilitation and Development Project. After he served at that position

for two years, in 1993, he was promoted to the Zonal Head of Disaster Prevention and

preparedness Department for West Shewa and worked at the position for six years.

He was transferred to his former Ministry, in 1998, and worked, at the position of Zonal Head

of Department of Agriculture for West Shewa. In September 2002, he joined Alemaya

iv
University, School of Graduate Studies for his M. Sc. in Agricultural Economics. The author is

a married and a father of two sons and a daughter.

v
 ACKNOWLEDGEMENTS

I would like to express my deepest gratitude to my major advisor, Dr. Legesse Dadi, for his

advice and guidance in the formulation of the M.Sc. research proposal from the beginning as

well as reshaping of the survey questionnaire and for his invaluable comments in my thesis

work without any reservation, and without whom the thesis would have not been materialized. I

also extend my thanks to, Professor R. S. L. Srivastava, my co-advisor for his constructive

comments and suggestions in the formulation of the research proposal and during the write-up

of the thesis.

I would like to thank Oromiya Bureau of Agriculture for allowing me join the School of

Graduate Studies, sponsoring my salary during my stay at Alemaya and giving me leave of

absence. GTZ LUPO (Land Use Planning for Oromiya Regional State) and its entire staff

deserve my appreciation and thanks for sponsoring the research work and providing me with all

supports of my query. My thanks would also go to Oromiya Irrigation Authority (OIDA),

Woliso and Wonchi District, Irrigation Development Offices, Offices of Agricultural

Development, Offices of Finance and Economic Development and Southwest Shewa Zone

Rural and Agricultural Development Desk for providing and letting me access to relevant

information.

I wish to convey my heart felt thanks to all the staff of School of Graduate Studies, Office of

Registrar, University Administration and library, and Department of Agricultural Economics for

their contribution and proper handling of administrative and academic matters.

I would like to express my apreciation to Adane Gudina, Demisie Zewudie, Fikre Mulugata,

Aynalem Megersa, Begashaw Wukaw, Tamene H/ Giorgis, Dr. Karin Gaesing, Dr. Aseffa

vi
Tolera, Abate Mengesha, Biruk Yinur and others, which listing all is difficult, for their

encouragement and support they have given me.

I extend my special thanks to my brother Dr. Nigusie Megersa for his encouragement, giving

access to Internet and frequently visiting my family during my stay at Alemaya. More than any

thing he has done for me and my family, his provision of a lab-top computer for extended

period of time during the course and research work is unforgettable and deserves a special

consideration.

I am grateful to Mohamad Hassena and Tarekegn for providing me the computer software

Frontier 4.1 version and SPSS version 10, respectively.

My thanks would also go to my dormitory and classmates, Tesfaye Kumbi, Abdu Watta and

Zerihun Getu, who made my stay at Alemaya enjoyable, simple and unforgettable learning

experience.

Finally, I am indebted to my wife, Addee Azmera Guluma, which earthly words of thanks can

not express my feeling in return to the supports and encouragement she has given me. She

sacrificed many of her interests for the success of my study and shouldered, in my absence, a

heavy task of family management, which in one way or another had contributed to the

successful completion of the study.

vii
 ACRONYMS AND ABBREVIATIONS
AU Alemaya University
DAs Development Agents
DOARD District Offices of Agriculture and Rural Development
DOFED District Office of Finance and Economic Development
DOID District Office of Irrigation Development
EARO Ethiopian Agricultural Research Orginization
Eth. Birr Ethiopian Birr
FAO Food and Agricultural Organization of the United Nations
Ha Hectare
HHs Household Heads
IDD Irrigation Development Department at MoA
IMT Irrigation Management Transfer
Kms Kilometers
LR Likelihood Ratio
Max Maximum
ME Man-day Equivalent
Min Minimum
MOA Ministry of Agriculture
MWRD Ministry of Water Resource Development
NGOs Non-Governmental Organizations
No Number
OBAD Oromiya Bureau of Agricultural Development
OBFED Oromiya Bureau of Finance and Economic Development
OIDA Oromiya Irrigation Development Authority
OLS Ordinary Least Squares
Qtl Quintals
OLS Ordinary Least Squares
RADSO Rural and Agricultural Development Supreme Office of Oromia Regional
State
SD Standard Deviation
SE Standard Error
SPSS Statistical Package for Social Science
TE Technical Efficiency

viii
 ACROMYMS AND ABBREVATIONS (Continued)

TLU Tropical Livestock Unit

VIF Variance Inflation Factor
WUA Water Users Association
WUAC Water Users Association Committee
ZARDD Zonal Agricultural and Rural Development Desk

ix
 TABLE OF CONTENTS

STATEMENT OF THE AUTHOR..................................................................... III

BIOGRAPHICAL SKETCH............................................................................... IV

ACKNOWLEDGEMENTS ................................................................................. VI

ACRONYMS AND ABBREVIATIONS .......................................................... VIII

TABLE OF CONTENTS.......................................................................................X

LIST OF TABBLES ......................................................................................... XIII

LIST OF FIGURES ...........................................................................................XIV

LIST OF APPENDICES..................................................................................... XV

ABSTRACT .......................................................................................................XVI

1. INTRODUCTION...............................................................................................1

1.1 Background.....................................................................................................1

1.2 Statement of the Problem ................................................................................4

1.3 Objectives of the Study ...................................................................................7

1.4 Significance of the Study.................................................................................7

1.5 Scope and Limitations of the Study .................................................................7

1.6 Organization of the Thesis...............................................................................8

2. REVIEW OF LITERATURE.............................................................................9

2.1 Concept of Irrigation .......................................................................................9

2.2 A Brief History of Irrigation Development ....................................................10

x
 2.3 Status of Irrigation Development in Africa ....................................................12

2.4 Irrigation Development in Ethiopia ...............................................................14

2.5 Irrigation Development in Oromiya Regional State .......................................18

2.6 Empirical Studies on Irrigation......................................................................19

2.6 Empirical Studies on Farm-level Technical Efficiency ..................................24

3. DESCRIPTION OF THE STUDY AREA .......................................................28

3.1 Socio-economic profile of Oromiya Regional State .......................................28

3.2 Socio-economic profile of Weliso District.....................................................29

3.3 Socio-Economic profile of Wenchi District ..................................................32

4. METHODOLOGY............................................................................................34

4.1 Selection of the Study Area ...........................................................................34

4.2 Sampling Techniques ....................................................................................34

4.3 Data Collection .............................................................................................36

4.4 Method of Data Analysis...............................................................................38

4.4.1 Descriptive Analysis...............................................................................38

4.4.2 Econometric Model ................................................................................38

4.4.3 Measurement of Variables ......................................................................43

4.4.4 Definition of Variables and Hypothesis Setting.......................................43

4.4.5 Estimation Procedure..............................................................................52

5. RESULTS AND DISCUSSION ........................................................................54

5.1 Household Characteristics .............................................................................54

5.2. Characteristics and Functioning of irrigation schemes .................................57

5.3. The Models Results......................................................................................61

5.3.1 Determinants of Household Income........................................................61

xi
 5.3.2 Technical Efficiency Measure.................................................................64

6. SUMMARY AND CONCLUSIONS.............................................................77

6.1 Summary.......................................................................................................77

6.2 conclusions ...................................................................................................79

REFERENCES .....................................................................................................83

APPENDICES.......................................................................................................90

xii
 LIST OF TABBLES

Table Page

1. Sampled Kebeles and number of sample HHs by Kebele.............................................36

2. Summary of definitions and measurements of variables used in the models..................51

3: Family size and other household characteristics of sampled households .......................54

4. Household resource endowments at the beginning of 2003/2004 .................................56

5: Household income, credit and input use .......................................................................57

6: Output of the regression model of income determination..............................................63

7. Likelihood functions and Likelihood ratios of both the Cobb-Douglas and Translog

production function frontiers. ...................................................................................66

8: Results of the OLS and ML Estimation of the production function...............................68

9: OLS and ML estimation of the production function and inefficiency for combined

irrigation user and non-user households....................................................................71

10: Distribution of households by technical efficiency ranges ..........................................75

xiii
 LIST OF FIGURES

Figure Page

1. Map of Southwest Shewa Zone of Oromiya Regional State (2004).............................31

2. Distribution of technical efficiency of irrigation user and irrigation

non-user households...................................................................................................76

xiv
 LIST OF APPENDICES

Appendix Page

1. Conversion Factors Used to Estimate Tropical Livestock Unit (TLU) .........................90

2. Conversion factor Used to estimate Person-days Equivalent (PE)

(agricultural labour force)............................................................................................90

3. Coefficient correlation of variables of income determination........................................91

4. Correlation coefficients of the explanatory variables in Cobb-Douglas

production function frontier.........................................................................................91

5. Collinearity statistics of income and production frontier variables ...............................92

6. Average annual Market prices of grain and bid prices of

agricultural inputs at district capital.............................................................................93

7. List of rivers in the sampled kebeles used for irrigation and hectares of land

developed using irrigation ...........................................................................................94

8. Physical and financial performances of small-scale irrigation

development in Oromiya. ............................................................................................95

9. Individual efficiency scores of both irrigation user and non-user households ...............96

10 Summary of Survey Questionnaire. .............................................................................97

xv
 IMPACT OF COMMUNITY MANAGED IRRIGATION ON FARM PRODUCTION
EFFICIENCY AND HOUSEHOLD INCOME: THE CASES OF WOLISO AND
WONCHI DISTRICTS OF OROMIYA REGIONAL STATE
BY
Desta Beyera Sefera (B.Sc.), AU
Advisors: Legesse Dadi (Ph.D), EARO.
Professor R. S. L. Srivastava, AU.

ABSTRACT

Agriculture is the mainstay of the country's economy and the major source of foreign
exchange earning and domestic consumption. To improve the prevailing low level of
production and productivity the use of yield improving inputs is of paramount important.
As the potential to increase production by bringing more resources into use became more
and more limited, the efficiency with which the farmers use available resources has
received the utmost attention. This being the case, in this study, an attempt was made to
examine the impact of irrigation on income and technical efficiency of households. The
study was conducted in two districts of Southwest Shewa Zone of Oromiya region. Survey
data collected from Weliso and Wenchi district during the 2003/2004 crop season were
used in both the descriptive and econometric model analysis. The survey data collected
considered two groups of farm households, irrigation users and irrigation non-users
households. Multiple linear regression model was used to estimate determinants of
household income. Furthermore, stochastic frontier production function with farm specific
technical inefficiency variables was used to estimate technical efficiency. The findings
indicate that farm size, amount of credit received, education level of household head and
access to irrigation have got significant influence on household income. Among the input
variables, farm size and capital were found to significantly influence agricultural output.
Access to irrigation was found to significantly improve the technical efficiency of
household. The whole sample mean technical efficiency of irrigation user and irrigation
non-user households was 78%. This implies that agricultural output can be increased on
the average by 22 percent if technical efficiency of farming households improved to obtain
the maximum attainable level of output.

xvi
 1. INTRODUCTION

1.1 Background

Ethiopia has an area of about 1.1 million square kilometers, making it the ninth largest country

in Africa. According to the 1994 population and housing census, Ethiopia's population is

projected at about 71 million in 2004 (CSA, 1998), out of which, eighty-five percent live in

rural areas (MOFED, 2002b)

Agriculture is the backbone of Ethiopia's economy, and it engages the majority of the

population. It accounts for about 50 percent of the GDP and 90 percent of the country's foreign

exchange earnings (MOFED, 2002a). Ethiopia has diverse physical features that influence

climatic conditions. It has 18 major agro-ecological zones and 62 sub agro-ecological zones

having their own physical and biological potentials. The country possesses one of the world's

largest and most diverse arrays of genetic resources. The geographical location of Ethiopia, its

endowment with favorable climate provides a relatively higher amount of rainfall in the eastern

region of Africa. In general, Ethiopia has an annual rainfall apparently adequate for food

production and pasturing for livestock. However, a wide range of climatic, ecological and

topographical diversities influence the agricultural productivity (Mengistu, 2000). The spatial

and temporal distribution of rainfall, however, is too uneven. Much of the eastern and northern

part of Ethiopia receives very little rain while the western and southern part, the highland areas

in particular, enjoys adequate rainfall. Reliable food supply is almost impossible due to the

temporal imbalance in the distribution of the rainfall and consequential non-availability of

required moisture at the required period. This is a frequent phenomenon in Ethiopia. Sometimes

even the western highlands of the country suffer from food shortage owing to discrepancies in

rainfall distribution ( MOWR, 2001).

1
Though Ethiopia has 3.5 million ha of irrigable land, irrigation covers only 0.16 million ha or

about 5 percent of the total irrigable land (MOWR, 1997). The dependence of most of the

farmers on rainfed agriculture has made the country's agricultural economy extremely fragile

and vulnerable to the impacts of weather and climatic variability. Absence of the rainfall and the

consecutive dry spells at critical times of crop growing season lead to partial or total crop

failure, which in turn results in food shortages.

Even though agriculture in one way or another has been the principal sector of the economy for

several thousand years, it remained less efficient owing to old and traditional means and

practices of farming on one hand, and the variability in the amount and distribution of rainfall

from year to year, on the other. Nearly, the entire peasant farming depends on rainfall which

has greater impact in hindering the agricultural production system (Fekadu, 1991). The

variability in the amount and distribution of rainfall from year-to-year creates uncertainties for

the farmers regarding the decision they should make about which crop to grow and the

particular operations and their timing (Michael, 1978).

Ethiopian agriculture is stagnating in both measures of agricultural productivity viz. land and

labour productivity. As such, it has not been able to meet its most basic and important functions

of producing sufficient food for the large and rapidly expanding population. Agricultural growth

averaged 2.2% during the 1960s, but dropped to 0.7% in the 1970s and a mere 0.5% in the

1980s. Crop yields have stagnated at about 1 ton per hectare since the early 1970s. With the

doubling of the population between 1970 and 1990, the per capita food production has sharply

declined and the country has become increasingly dependent on food aid in recent years.

2
Agriculture today is at the heart of the Ethiopian government's policies and strategies to

improve the livelihood of the rural population. Part of the on-going debate on how to transform

agriculture focuses on improved technology, input levels and credit allocation ( Corppenstedt

and Abbi, 1996). Currently, Special attention has bee paid to the areas with high rainfall

variability and high moisture deficit to tackle the problem of food insecurity that has persisted

for decades. The use of supplementary irrigation from either traditional or modern water

harvesting structures is considered the primary measure to be taken against the problem. In this

direction government of Ethiopia is making serious efforts by allocating a fairly large amount of

budget for the development of irrigation structures. The manufacturing and or importation of

simple and manually operated water lifting devices are being encouraged. However, in

economic terms, the incentive for the farmer to use a given technology would ultimately depend

on the return or the income he generates from the technology. Given, economic, social and

environmental differentials among rural households, the impact of a technology on household

livelihood should be continuously assessed and evaluated.

To this end, this particular study aims at investigating whether the access to community

managed irrigation has positive impact on rural household-income and improves the technical

efficiency of the farmer.

3
1.2 Statement of the Problem

Major constraints to agricultural growth of Ethiopia are population pressure coupled with the

dominance of the use of traditional agricultural production technology, including traditional

farm tools and farming practices, low application of modern inputs like improved seeds and

fertilizers, and poor animal breeds. The country's capacity to support agriculture through

development of irrigation has been weak (Mengistu, 2000).

For a country facing recurrent drought, with severe consequences for development, the need for

irrigated agriculture cannot be over-looked. Ethiopia cannot hope to meet its large food deficit

through rain-fed agriculture alone. Even under favorable weather conditions with very low

annual growth in only rain-fed agricultural production, the country could still face millions of

tons of cereal deficit for decades to come.

The economic impact of irrigation and the contribution of irrigation to food security and as an

engine of development are new themes in research programs. They have not been systematically

addressed in the past. Most research has sought to find ways to improve irrigation performances

in the operational sense. But currently, as the issues of food security and poverty reduction are

becoming the global agenda, it started giving emphasis on the importance of increasing yields

and income from irrigated agriculture to meet food needs and to reduce poverty. The rationale

behind this is that with the availability and proper utilization of irrigation in an area, crops can

be grown more than once in a year through supplementary irrigation. Cropping intensity (which

is measured by the ratio of total cultivated land to total area that is covered by different crops in

a given year) may be higher than the rain-fed agriculture (Merrey, 1997). Moreover, irrigation is

believed to increase the productivity of other critical inputs like improved seeds, chemical

fertilizers, land and labour.

4
To get out of the recurrent food insecurity and poverty prevailing in Ethiopia, different means,

tools and strategies have been suggested by different individual and groups. Among which

irrigation development and wise utilization of surface and ground water are the ones.

Using a deterministic hydrologic model, Taffa (undated) simulated and analyzed the water

balance of four representative rivers in West Shewa. The simulation showed that rain-fed

agriculture can be practiced in West Shewa for seven months (March to September), and the

rest of the months should be supplemented with irrigation implying the importance of the

development of small-scale irrigation. The small-scale irrigation development will be beneficial

for the country for three reasons. First and foremost, it supports the realization of food self-

sufficiency and food security. Secondly, it improves the living quality and standard of the

people through the provision of sustainable agriculture and thirdly, it enhances the contribution

of irrigation in attaining development priorities, programs and objectives (Taffa, undated)

The use of irrigation allows growing of two or more crops in sequence on the same field within

in a year. The succeeding crop is planted only after the preceding crop has been harvested.

Thus, irrigation increases volume of output obtained from a given field in a year. Moreover, in

moisture deficit areas, the use of supplementary irrigation will make the nutrients in the soil

available to the crops to grow to their full maturity. In doing so, it contributes to the increase in

productivity of a given farmland. That means, the use of irrigation is one of the spectrums of

technologies available to increase agricultural production. And one can also sense that there is

an observable income gap between farmers using irrigation and non-users of irrigation. The

improvement in agricultural production determines the rate of economic development of the

nation.

5
Agricultural productivity and production can be increased either by increasing necessary inputs

or by introducing modern agricultural technologies. Given agricultural technologies and input

levels, agricultural productivity and production can be increased through improvement in

efficiency of production.

Irrigation is assumed to improve technical efficiency of crop production. However, it is not well

known to what extent the households using irrigation are better off than those who depend on

rainfall and whether there exist variability in technical efficiency among the farmers in the study

area. The levels of income of rural households can be taken as one of the indicators of the

livelihood status of the rural community. The existing potentials and efforts to increase income

and the level of technical efficiency of the rural households are known least. The knowledge

regarding the contribution of irrigation to household income and technical efficiency is

insufficient in the study area. An in-depth comparative analysis of household income and

technical efficiency differentials taking into account different aspects of irrigation is also

limited.

Moreover, in the area, significant attempt has not been made to study and analyze the impact of

irrigation on different economic, social and cultural life of rural farmers.

Therefore, this study was initiated to analyze the impact of irrigation on technical efficiency and

income of rural households. The result of the study would contribute to the development

objectives of the country in general and the region in particular. It, also, assessed issues with

respect to community managed irrigation systems that need government attention and

interventions.

6
1.3 Objectives of the Study

With the aforementioned problems in mind this particular study was conducted with the

following specific objectives

1. To describe the characteristics and functioning of community managed irrigation system.

2. To compare agricultural production and technical efficiency of irrigation user and non-users

households.

3. To compare the levels of income of irrigation user and non-user households.

1.4 Significance of the Study

The attainment of the objectives mentioned above is important tool for agricultural development

of the country. This is because determining the contribution of irrigation to household income

improvement as well as determining the efficiency status of farmers are very important for

policy formulation and implementation. Efficiency also is a very important factor of

productivity growth. In a country, like Ethiopia, where resources are so scarce and opportunities

for new technologies are minimal, inefficiency studies will be able to indicate that it is possible

to raise productivity by improving efficiency without increasing the level of inputs (resources)

or developing new technology.

1.5 Scope and limitations of the Study

The study covered two districts of Southwest Shewa Zone of Oromiya Regional State. It

analyzed the effects of community managed irrigation schemes on technical efficiency and

household income.

The study was limited to only two districts due to limited resources and time. The research was

undertaken in the two districts assumed to have similar ecology, economic, social and

demographic characteristics as compared to the area and variations that exist within the region.

7
In this study, household level production data of only one-year period (2003/2004) was used.

The sample size is also restricted to one hundred twenty one farmers.

In the course of survey work, it was found that farmers are very reluctant to frankly respond to

some of the questions, particularly to questions of resource holdings such as number of

livestock owned, land size, yield and household incomes. Also as farmers do not keep records

and due to memory lapse, some of the questions lack exact answers and the respondents

attempted by giving ranges or estimates.

The survey was conducted almost at the same time that the Regional Government was

conducting household land holding measurement for land entitlement. This activity made the

farmers very curious and suspicious regarding their land holdings.

1.6 Organization of the Thesis

The thesis has six chapters. The first chapter is concerned with the introductory part, which

comprises the background, statement of the problem, objectives of the study, significance of the

study, and scope and limitation of the study. The second chapter deals with the review of

literature. The third chapter focuses on the description of the study area. The methodology of

the study is covered in the fourth chapter. The chapter briefly discusses procedures followed in

data collection, estimation procedures, model used and hypothesis settings. Results and

discussions are given in chapter five. The last part of the thesis is the summary and conclusion.

8
 2. REVIEW OF LITERATURE

2.1 Concept of Irrigation

Water is the greatest source of humanity. It not only helps in survival but also helps in making

life comfortable and luxurious. Besides various other uses of water, the largest use of water in

the world is for irrigating land. Irrigation in fact is nothing but is a continuous and reliable water

supply to different crops in accordance with their water requirement. When sufficient and

timely water is not available to the crops, they fade away resulting in lesser yields (Garg, 1989).

The basic problem of water distribution in the world is the temporal and spatial differences that

exist in the supply and demand of water. The general solution of this problem lies in adjusting

water supply and demand so that the demand will always be smaller than or equal to supply

(Taffa, undated).

The primary goal of irrigation, from farmer's perspective, is to deliver the volume and quality

water required by plants, throughout a season, to optimize plant growth and crop production

(Wichelns, 2000). Small and Svendsen, as it was cited in Wichelns (2000), define irrigation as "

human intervention to modify the spatial or temporal distribution of water,…, and to manipulate

all or part of this water for the production of agricultural crops". Chamber (1988) suggested that

from a farmers perspective, good irrigation service involves the delivery of "an adequate,

convenient, predictable and timely water supply for preferred framing practices."

These perspectives of irrigation goals and performance are used to define the concept of

irrigation from farmer's viewpoint. Irrigation success considers the degree to which water

volume and quality, and the time of irrigation events match the requirements of plant

throughout the season. Perfect success occurs when the volume, quality, and timing of water

9
deliveries would generate maximum crop yield, given that non-irrigation inputs are not limiting.

Actual yield will be less than maximum yield when irrigation success is less than perfect.

Farmers attempting to maximize net revenue, subject to resource constraints, will select

irrigation inputs to achieve a desired level of irrigation success (Wichelns, 2000).

It can therefore, be concluded that if full irrigation facilities are not developed, reduced crop

yield shall be obtained and if sufficient grains are not available, virtually the entire progress of

the humanity shall be hampered. In light of these facts, it can be easily emphasized that

irrigation is the must, at least in tropical or sub tropical countries. Irrigation may, therefore, be

defined as the science of artificial application of water to the land, in accordance with the crop

requirements through out the crop period for full-fledged nourishment of the crops (Garg,

1989).

2.2 A Brief History of Irrigation Development

Irrigation is an old human activity and been practiced in some parts of the world for several

thousand years. Rice has been grown under irrigation in India and Far East for nearly 5000

years. The Nile valley in Egypt and the plain of Tigris and Euphrates in Iraq were under

irrigation for 4000 years (Peter, 1979).

Irrigation has formed the foundation of civilization in numerous regions for millennia.

Egyptians have depended on the Nile's flooding of the delta for years; this may well be the

longest period of continuous irrigation on a large scale. Mesopotamia, the land between the

Tigris and Euphrates, was the breadbasket for the Sumerian Empire. This civilization managed

a highly developed, centrally controlled irrigation system. In that same time frame, irrigation

apparently developed in present day China and in Indus basin( Schilfgaarde, 1994).

10
In vast area of the world, namely in the Mediterranean zone, traditional surface irrigation

techniques are still dominant. These techniques are based on short blocked furrows and very

small basin on unleveled lands, with manual water distribution at the higher zone of the field.

Low performances are commonly associated with traditional surface system. Such system

requires high labour, water is not uniformly distributed and inefficient application are observed.

Increase of labour costs and its scarcity, together with low performance, are increasingly

affecting the use of these traditional technique ( Sousa et al., 1999). There are various

techniques in which the irrigation water can be applied to the fields. Some of these techniques

include flooding, furrow irrigation, sprinkler irrigation and drip irrigation. In flooding method

of irrigation water covers the entire surface of the field to be irrigated, while in furrow

irrigation, only one fifth to one half of the land surface is wetted by water, it therefore results in

less evaporation. Sprinkler irrigation is a method whereby the water is applied to the soil in the

form of a spray through a network of pipes and pumps. It is a kind of artificial rain and gives

very good results interms of fulfilling the normal requirements of the plant and uniform

distribution of water. Drip irrigation is the latest field of irrigation technique and is ment for

adoption at places where there exists acute scarcity of irrigation water. In this method water is

slowly and directly applied to the root zone of the plants, thereby minimizing the losses by

evaporation (Garg, 1989).

Canal irrigation is a direct source of livelihood for hundreds of millions of the rural poor of the

third world. In China, Egypt, Indonesia, Mexico, Philippines, Sudan and Thailand, to name

some, canal irrigation is a major part of the rural and national economy. In several ways,

increased agricultural production can diminish rural poverty. At the level of the national

economy, increased agricultural production can substitute for imports and generate exports.

Increased agricultural production can also reduce the cost of food grain procurement. Hence,

11
irrigation, as an attempt to increase agricultural production it usually reduces food prices and

makes it easier especially for the urban poor to obtain food. Irrigation also generates additional

employment and incomes for the poor, both directly through employment in agriculture and

indirectly through multiplier effect as incomes are spent, generating more employment and

incomes.

Thus, the role of irrigation is meeting world food needs. In this connection, production thinking

which sees production as a sufficient and in itself, contrasts with livelihood thinking which sees

production as a means of enhancing the well being and livelihoods especially of the poorer

people. With livelihood thinking irrigation is assessed in terms of the adequate and secure

livelihoods it generates and sustains, putting anti poverty effect, and people, before per se. An

adequate and secure livelihood can be defined here as a level of assets and stocks and flows of

food and cash which provides physical and social well being for household and protection

against impoverishment. This applies to all members of household and especially to women,

who are most deprived (Chamber, 1988).

2.3 Status of Irrigation Development in Africa

There is growing concern about food security in Africa and especially in Sub-Saharan Africa.

While the aggregate global food supply/demand picture is relatively good, there will be a

worsening in food security in Sub-Saharan Africa and cereal imports are projected to triple

between 1990 and 2020; imports for which the region will not be able to pay. Africa is the driest

continent (apart from Australia) and suffers the most unstable rainfall regime (FAO, 1997).

Droughts are frequent in most African countries and each year more people are at risk from the

effects of inevitable droughts of greater or lesser severity. Furthermore, Africa's water resources

are relatively less developed than those in other regions.

12
Agricultural productivity per capita in Sub-Saharan Africa has not kept pace with population

growth, and the region is now in a worse position nutritionally than it was 30 years ago. Food

production has achieved a growth of about 2.5 percent per year, while population has risen at a

rate of over 3 percent per year. In the past, additional food in Africa came from increase in the

area cultivated, but as a good land becomes less available, the region will be forced to increase

yields through the use of irrigation and other modern technologies. Both rain-fed and irrigated

agriculture will need to be intensified, but irrigated agriculture has a higher potential for

intensification (FAO, 1997).

Global estimates indicate that irrigated agriculture produces nearly 40 percent of food and

agriculture commodities on 17 percent of agricultural land (FAO, 1995b). In Sub-Saharan

Africa, only about 10 percent of the agricultural production come from irrigated land. Trends in

irrigated land expansion over the last 30 years show that, on the average, irrigation in Africa

increased at a rate of 1.2 percent per year, this rate began to fall in the mid-1980s and is now

below 1 percent per year, but varies widely from country to country.

While it is true that there still exists considerable potential for the future expansion of irrigation,

it is also true that water is growing scarcer in those regions where the need for irrigation is

greater. Over half of the total water withdrawal takes place in the northern, drier part of Africa.

Moreover, in this part the withdrawal for domestic and industrial uses will grow fastest, though

it will grow in Sub-Saharan Africa in the coming years, as a result of the rapid urbanization

(FAO, 1997).

The total water resources potential of Africa is 20,211 km3/year and 3991 km3/year from

precipitation and internal renewable resources respectively. The water resource withdrawal of

13
the continent as a whole is estimated to be about 149,920 million m3/year, which is directed to

agriculture, community and industrial sectors. About 85 percent of the water withdrawal is

directed to agriculture, but this figure varies considerably from one region to another. Arid

region where irrigation plays an important role in agriculture has the highest level of water

withdrawal of agriculture. In contrast, the humid regions show the lowest withdrawal. The

total irrigated land of Africa is estimated to be 124 million ha. This figure includes all the land

where water is supplied for the purpose of crop production. It represents an average of 7.5

percent of arable land (FAO, 1995a).

2.4 Irrigation Development in Ethiopia

Traditional irrigation is very old in Ethiopia. The traditional small-scale schemes are, in general,

simple river diversions. The diversion structures are rudimentary and subject to frequent

damage by flood. Modern irrigation was started at the beginning of the 1960s by private

investors in the middle Awash valley where large quantities of sugar cane, fruit and cotton are

produced. With the 1975 rural land proclamation, the large irrigated farms were placed under

the responsibility of the Ministry of State Farms. Almost all small-scale irrigation schemes built

after 1975 were organized into producers' cooperatives (FAO, 1995c).

For much of the lifetime of the Derg, very little attention was paid to small-scale and traditional

irrigation schemes constructed and managed by peasant farmers. With the nationalization of

industrial and agricultural enterprises, the government's emphasis was to promote high

technology water development schemes managed by state controlled agro-industrial and

agricultural enterprises. It was only in the second half of the 1980s, as a result of devastating

famine of 1984/85 that the Derg began to show interest in small-scale water management

schemes. The establishment of the Irrigation Development Department (IDD) within MoA at

the end of 1984, a body entrusted with the development of small-scale irrigation projects for the

14
benefit of peasant farmers, signaled a new approach to water development by the military

government. However, progress was slow. From the mid- 1980s to 1991, IDD was able to

construct some 35 small schemes, of which nearly one-third was formerly traditional schemes

used by peasants (MoA, 1993; Desalegn, 1999).

Small-scale irrigation development was carried out by the surface water division of the Soil and

Water Conservation Department (SWCD) of the Ministry of Agriculture (MOA). In 1984, the

division was separated from SWCD and upgraded to IDD. In 1987, the activities of MOA were

being decentralized to zonal offices, and IDD staffs were being transferred to strengthen the

capacity of the zones. However, in 1992, a new Ministry of Natural Resources Development

and Environmental Protection (MNRDEP) was established, with the responsibility for soil and

water conservation, rural water supply and sanitation. Although the Ministry retained

responsibility for providing agricultural support services, the IDD was dissolved and its

responsibilities were transferred to regional Natural Resources Bureau. In August 1995,

MNRDEP was dissolved and its responsibilities were shared between MOA and the Ministry of

Water Resources (MOWR). Under the new arrangements, responsibility for irrigation

development was given to the Bureau of Water, Minerals, Energy Resources Development

(BWMERD) while MOWR has an overall policy, planning and regulatory role in respect to

water resource development (JICA, and OIDA, 2001).

Ethiopia has a high potential for irrigated agriculture. It is endowed with abundant water

resources; lakes covering 7400 square kilometers, 10 major rivers, and other water bodies,

which are expected to provide extensive potentials for irrigation and fish farming (Mangistu,

2000).

15
Although, water resource potential is said to be abundant in Ethiopia, it is clear that even by the

low standard of African countries, Ethiopia's use of its water resources is very limited. Less than

5 percent of the country's irrigable land is now under irrigation. In contrast, according to FAO

(1987), the three countries in Sub-Saharan Africa with the largest irrigation are Sudan (2.2

million ha), Madagascar (1.00 million ha) and Nigeria (0.9 million ha). In Sudan, 14 percent of

the country's cropped land is under irrigation, while in Madagascar, the figure is 32 percent. In

contrast, almost all the cropped land in Egypt is under irrigation. For comparison, irrigation in

Ethiopia covers less than three percent of the country's cropped land. Assuming that all the

irrigated land is utilized to produce food crops, the contribution of irrigation to the production

of food would not be significant when compared to the area under rain-fed (Desalegn, 1999).

Therefore, a rational management and development of water resources is required to effectively

and efficiently utilize water resources to achieve food self-sufficiency and food security. Thus it

is essential to develop a small-scale irrigation system. Harnessing some of the sizable rivers can

produce some medium-to small-sized irrigation projects (Taffa, undated).

It is quite evident that irrigation development in Ethiopia did not attempt to involve the farming

population both in planning and construction phases. Modern irrigation by and large bypassed

the peasant, and the technology involved and the operation and management of irrigation

schemes was entrusted a small technical and managerial elite working for large-scale investors

interests in the past and later for state or parastatal enterprises. On the other hand, there is a long

tradition among peasant farmers of water management for small-scale agricultural use. More

than 40 percent of the irrigated land in the country is served by traditional schemes (Desalegn,

1999).

16
Research on irrigation management and drainage in Ethiopia was first initiated in 1964 at Werer

Agricultural Research Center. The main focus of the research was on the agronomic aspects of

irrigation on cotton production. More work has been done on the crop water- requirement of

different crops. Investigations on alternative irrigation systems and assessment of indigenous

knowledge were given attention only recently. At present, research on irrigation, drainage and

water conservation has been initiated in other research centers of Ethiopian Agricultural

Research Organization (EARO) located in the sub-moist and moist agro-ecological zones

(Paulos, et al.,). The above statement clearly indicates that research in irrigation development in

the country has been confined to specific disciplines and did give little or no attention to the

economic and organizational issues of irrigation management.

With the political and economic reforms, the importance of peasant farming and private

agriculture as the foundation of economy was recognized and a greater share of budgetary and

human resources have been devoted to the rehabilitation and expansion of irrigation schemes

(see appendix 6). As producers' cooperatives have failed, the farmers are now forming Water

Users Associations with technical support of government and non-governmental organizations.

(FAO, 1995c).

Ethiopia can not meet its large food deficits through rain-fed agricultural production alone.

Cognizant to this fact, the government has taken initiatives towards developing irrigation

schemes of various scales. This will continue and be further strengthened during the coming

years. The maximum area quoted to be currently under irrigation is estimated at about 5 percent

of the potential, accounting for merely 3 percent of the country's total food production. In the

short-term, however, the irrigation development program gives emphasis to the development of

small-scale irrigation in which capacity building in the study, design and implementation of

17
irrigation projects are the forefront. During the program period of 2002/03-2004/05, irrigation

program aims to develop a total of 29,043 hectares of new land which bring the total area under

irrigation to 226,293 hectares, making 114,390 households beneficiaries. The small-scale

irrigation schemes for the stated period is expected to cover an area of 23,823 hectares,

benefiting about 93,510 households (UK Trade and Investment, 2003).

2.5 Irrigation Development in Oromiya Regional State

The envisaged effort towards irrigation development, more specifically community managed

small-scale irrigation development, in the country in general and Oromiya region in particular

can be clearly reflected by the number of structures constructed and resources allocated for this

purpose.

The past 20-year's scenario of the physical and financial performances of irrigation

development of the region is shown in the Appendix 6. In the Appendix it was attempted to

reflect the scenario in three categories. (i) During the last quarter of the Derg regime, only 14

schemes were developed in the region with the capacity of irrigating 1122 ha of land and

benefiting only 3471 households; (ii) Between 1991/92- 1997/98 (in the period of Transitional

Government of Ethiopia) the numbers of schemes developed in the region have been increased

by 6 folds, that is, about 79 modern small-scale schemes with the capacity of irrigating 6788 ha

of land and benefiting 16,909 households; (iii) In the recent past six years, the years between

1998/99- 2003/2004, 68 schemes with the capacity to irrigate 5428 ha of land and benefiting

15,158 households were developed.

In general, during the Derg regime and/or probably the time before that, less or no attention has

been given to small-scale community managed irrigation development. The contribution of

irrigation to household food security was less known or purposefully ignored giving high

18
priority to side issues and other political agendas. The extension programs and scheme

constructions were not participatory and disregarded the endogenous knowledge.

The period between 1991/92- 1997/98, although it had its own hangover problems, was the

turning point for irrigation development in the region. Regardless of whatever level irrigation

efficiency and degree of utilization by the community, the attempt made by the government to

develop irrigation schemes was substantially high and encouraging. It seemed that the

government had realized the contribution of irrigation, and gets convinced that sustainable

development can not be attained by ignoring proper management and utilization of water

resource potential of the country.

However, irrigation development of the region between 1998/99- 2003/2004, although not

discouraging, seemed to lose it momentum. The physical and financial performance as well as

the number of households it benefited was less than the transitional period. It is worthwhile to

mention that the region should critically evaluate the performances of the existing irrigation

schemes and harnesses the pace by which it is moving to bring about meaningful differences.

Moreover, research on irrigation management in the region should get due attention.

2.6 Empirical Studies on Irrigation

For the last two decades, many Sub-Saharan African countries have pursued large-scale

irrigation as a strategy for increasing agricultural production. This approach to irrigation

development focuses on the establishment of dams across major rivers. The water impounded,

as a result of dams, is then used to irrigate large expanses of land, which are cleared, leveled,

cultivated and then rented out to farmers for growing crops. The establishment of such large-

scale irrigation scheme has often been rationalized on the grounds that the benefits of a few

large-scale schemes would "trickle down" to the general populace. The wisdom in establishing

19
such capital- intensive projects in capital-starved countries has, however, been questioned, and

the schemes have been associated with a long list of shortcomings. For example, high level of

non- participation by local farmers, establishment of such schemes has forced these countries to

be dependent on advanced countries that have the technology and expertise to design, construct

and manage the scheme (Baba, 1993).

Smallholder irrigation development in Zimbabwe has been accorded high priority since the

attainment of national independence in 1980. The major thrust of this effort has been to help

raise the living standards of rural households through improved food security, high incomes,

and better employment opportunities amid recurring droughts (Shumba & Maposa, 1996).

The study carried by Shumba and maposa (1996) revealed that, income generations and food

security are major reasons for joining the scheme. Employment creation was considered as a

secondary objective. Plot holders meet their objectives by growing crops in the summer and

vegetable in the winter. Notwithstanding the constraints, like unreliable water supply, limited

cash for input purchase, poor roads and limited market outlets, the plot holders’ objectives have

been met to some extent. They reported having achieved improved food security, high incomes

and increased employment opportunities in comparison to "without irrigation" situation. The

study also revealed that there was complementarity among the objectives of food security,

income generation and employment creation

Kennedy Mudima, (1998), has evaluated the importance of irrigation from different

perspectives. In the evaluation of case studies carried in Zimbabwe, Mudima reported that

smallholder irrigation schemes were reliable sources of household income. The household

incomes of farmers in the irrigation schemes during the study were higher than the minimum

20
wage, which is paid for unskilled labour in the Zimbabwean industry and agricultural industry.

From social point of view, a farmer in an irrigation scheme is certainly much better off than

labourers in an urban industries who are faced with a lot of other demands like rent, water and

electricity charges on their incomes. This gives every reason for the government to channel

resources to small-scale irrigation development. Moreover, the evaluation of the successful

irrigation schemes showed that under irrigation, high cropping intensities were practiced. The

cropping patterns were normally dominated by vegetables and high value crops, so that the

farmers can generate enough income to operate and maintain the irrigation schemes. In most

cases, the cropping pattern is a compromise between subsistence requirement, availability of

sound agronomic rotations, roads infrastructures, proximity to markets and market demand.

Moreover, irrigation is one way of generating employment in rural areas. The availability of

employment in the irrigation schemes is also important in terms of reduction of rural to urban

migration. The reduction in migration is in fact a saving for the urban municipalities in terms of

an avoided cost of providing services like housing, water, education and health to potential

migrants. According to the same study carried in Zimbabwe, the five irrigation schemes

surveyed were found to act as sources of food security for the participants and the surrounding

community through increased productivity, stable production and incomes. The farmers

participating in the irrigation schemes never run out of food unlike their counterparts that

depend on rain-fed agriculture.

According to Quasem 1994, it was found that provision of irrigation have got immediate effect

on expansion of modern rice (MVs) in Bangladesh resulting in larger production and higher

incomes from both crop outputs and trading of output and inputs. To be specific, highly

irrigated villages had higher income than the two other categories of villages studied (low

irrigated, medium irrigated).

21
Among the three irrigation categories, contribution of agriculture to household income was the

highest (about 70%) in highly irrigated villages. The absolute size of agricultural income was

also the highest in highly irrigated village despite the small farm size and cultivated holding.

Per hectare agricultural income (interms of both owned and cultivated land) was also found to

increase with the increase in the irrigation intensity of the villages. The highly irrigated villages

had higher per hectare agricultural income by over 50% over the low irrigated village. It may

thus, be concluded that irrigation has significant positive impact on agricultural income.

Moreover, the same study found that irrigation have got a positive impact on wage employment

and in that respect highly irrigated villages had higher wage income as a result of more man-

days of employment and higher wage rates. Irrigation could help raise wage earnings but not the

wage rates as that might be leveled-off by in and out migration of labor. The impact of irrigation

was found visible interms of income per hectare of land owned by household. This has been

found to rise with the increase in irrigation intensity of villages. The highly irrigated village

earned 36% higher per hectare income over the lower irrigated village suggesting that the

productivity of land rise with irrigation (Quasem, 1994).

In the study designed to estimate the economic contribution of small-scale (pump) irrigation to

crop production in Nigeria, Onyenwaku (1994) found that the technical change introduced by

small-scale pump irrigation schemes is factor-biased or non-neutral. And that technical

efficiency is higher on irrigated farms than on unirrigated farms. The study also showed that

unirrigated farms underutilized land, capital and other farm inputs for which the estimated

regression coefficients were statistically significant. Irrigated farms similarly underutilized land,

capital, and other farm inputs, and overutilized labor and irrigation services. Irrigated farms

22
employed larger quantities of all variable inputs than unirrigated farms. In addition, output per

unit was much higher on irrigated farms than on unirrigated farms.

An empirical study conducted by Chabayanzara, (1994) in Zimbabwe showed that agronomic

conditions, rainfall and availability of water tend to determine the extent to which a crop is

grown as a cash crop. It was observed that there was little variation between irrigation user and

irrigation non-user households in types of cash crops grown. However, irrigation has allowed

the irrigation user households to have two crops per year and to diversify the range of cash

crops produced into high value horticultural crops. Furthermore, the study showed that

irrigation user households had a higher percentage of externally sourced food. Irrigation user

households tended to maximize income from their irrigated plots. In contrast, irrigation non-

user households aimed to minimize food purchases because of low incomes from their crops.

For both irrigation user and irrigation non-user households, crop income was dominant.

Samad (2002), reviewed selected experiences from Asia and Latin America to analyze the

impact of irrigation management transfer1 (IMT) on the performance of irrigation systems.

Performance of irrigation was measured from different perspectives: the costs the government

and farmers incur to operate and maintain irrigation systems, the quality of irrigation service

and agricultural productivity. The main aim of the analysis was to determine whether there have

been noticeable changes in performance of the schemes after management transfer. The results

obtained from the analysis were mixed and suggest that there is no enough evidence regarding

the extent of change. It also indicated that there is a clear need for comprehensive and long-term

monitoring of the impacts within the framework of Irrigation Management Transfer (IMT),

requiring collaborative effort involving the direct stakeholders, governments, international

23
financing institutions, and local and international research organizations. More systematic

research methods need to be applied with enough commonality to permit conclusions about the

impact and specify policy and institutional conditions under which IMT programs could be

expected to succeed or not. This should not, in fact, discount IMT as an appropriate institutional

intervention for improving the performance of irrigation schemes. At the same time one should

not be evangelical about the merits of reform, but rather find ways to implement IMT programs

in a more cost-effective way. Samad (2002), concluded his analysis by recommending further

research to appropriate institutional arrangements which are compatible with socio-economic

contexts, foster inter-sectoral linkages, safeguard the interests of disadvantaged groups and

provide effective accountability and incentives for management.

2.6 Empirical Studies on Farm-level Technical Efficiency

Ethiopian agriculture is dominated by smallholders. Increasing productivity of smallholders is

crucial for the country's economic development. There are two schools of thought regarding

development strategies for small-scale farmers in developing agriculture. The first one states

that there are few inefficiencies that exist in allocation of factors of production in peasant

agriculture. The second school of thought states that there exist inefficiencies among small-

scale farmers. The first, view the problem that to increase productivity, the development and

introduction of new technology is required. Whereas, the second school of thought put an

emphasis on increasing efficient use of existing technologies and resources which, on the other

hand can increase productivity (Farrel, 1957; Schultz, 1964). Several empirical studies

conducted at different times in different parts of the world supported this view (Assefa and

Franz, 1996; Getu et al., 1998; and Mohammed et al., 2000).

1
Irrigation Management Transfer is defined as the partial or total devolution of responsibilities of scheme
management from government to a community.

24
There are many reasons for measuring efficiency. Efficiency measures help identify relatively

efficient unit or firm and give an estimate of the potential for resource conservation and/or

output increases if the inefficient ones are improved. Therefore, measuring efficiency is

important as it might lead to substantial resource saving. Resource savings have important

implications for both policy formulation and firm management (Abrar, 1995). As the potential

to increase production by bringing more resources into use becomes more and more limited, it

is natural that the efficiency with which firms or farmers use available resources would become

more important as a topic of investigation (Abay et al, 1996).

Getu et al.(1998) estimated farm specific technical efficiency using survey data collected from

sample farmers at Babile, Ethiopia. They used a stochastic production frontier model and the

major finding of the study supported the existence of overall technical inefficiency as well as

variations in technical efficiency levels among individual farmers. The farm level technical

efficiency ranged from 20% to 91% in 1993 and from 30% to 100% in 1994, and the mean

technical efficiency was found to be 61% and 69% in 1993 and 1994, respectively. Their results

imply that the total output of the sample farmers in the study area could have been increased by

30-40 percent above the actual output levels attained.

Mohammed et al.(2000) have reported that the average technical efficiency of barely production

in Asasa district of southern Ethiopia is 0.55, indicating that the farmers are only producing on

the average 55 percent of their maximum possible output level, given the state of technology at

their disposal.

Similar studies conducted in developed countries showed technical efficiency variations

between farms. In a study aimed at estimating technical efficiency in Swedish crop farms,

25
following a pseudo panel data approach, Heshmati and kumbhakar found that the largest

concentration of farms have got the efficiency interval between 75-80 percent. The sample

mean of persistent technical efficiency was found to be 76 percent with the standard deviation

of 12 percent (Heshmati and kumbhakar, 1997).

Tzouvelekas et al. (2001) analyzed the technical efficiency of organic and conventional olive-

growing farms in Greek and found that the organic olive-growing farms exhibited a higher

degree of technical efficiency (relative to their production frontier) than the conventional olive-

growing farms. There is also a considerable scope for cost reducing and farm income

improvement in both farming modes.

Thiam et al. (2001) reviewed 35 studies on technical efficiency in developing countries

agriculture. Eight and twenty seven of the studies reviewed employed the deterministic

production frontier model (six parametric and two non-parametric) and stochastic production

frontier model (sixteen cross-sectional, six panel-data and five dual frontier) respectively. They

found that the parametric studies relying on Cobb-Douglas functional forms have got technical

efficiency measures ranging from 52 to 84 percent with an average of 71 percent. The average

TE for the 16 studies using cross-sectional data was 69 percent, with a low 50 percent and a

high of 100 percent. They also reviewed different approaches to efficiency measurement. The

total numbers of studies reviewed that have used the Cobb-Douglas functional forms were six

and thirteen for the deterministic production frontier (parametric frontier) and the stochastic

production frontier respectively. While fourteen studies reviewed employed a translog

functional forms.

26
Bakhshood and Thomson (2001) obtained a mean technical efficiency of 93%, which ranges

from 73% to 99%. The mean value indicate that output can be increased by 7 percent with the

same amount of input as before. The level of inefficiency was found to be related to farm size;

small and large farms were shown to be more technically efficient than medium sized farms and

efficiency was found to be affected by some input ratios.

Kalirajan and Shand (2001) estimated the technical efficiency of irrigated and non-irrigated

farms in Thamil Nadu, India, using stochastic production frontier. They reported that the mean

technical efficiency showed increase trend over time for the irrigated sample. From an initial

sample average around 68 percent technical efficiency increased season by season with few

fluctuations but slowly over 9 years period to around 75 percent giving 7 percent point rise over

the period considered. In the non-irrigated sample, the increase over the 9 years was even

slower, from 63 to 66 percent, or only 3 percent points for the period. The difference may well

reflect the greater production risks in the absence of irrigation and therefore the greater the

difficulties for farmers in selecting optimum technical practices.

27
 3. DESCRIPTION OF THE STUDY AREA

3.1 Socio-economic profile of Oromiya Regional State

Physical Characteristics:- Oromiya Regional State lies in the central part of the Federal

Democratic Republic of Ethiopia, with the large protrusions towards the south and the west

directions. It extends from 30 40`N to 100 46`N latitude and from 34008`E to 42055`E longitude

(OBPED, 2000). It has an area of 363,007 km2, and accounting for 32 percent of the country's

land area. This forms a total of 5672-km borderlines and physical contacts with all regional

states except Tigray, and also have international borderlines with the Republic of Kenya and

Sudan. The political administration of the region consists of 14 fourteen administrative zones,

197 districts and about 5968 and 483 peasant and urban dwellers association, respectively

(RADSO, 2003).

According to the 1994 Population and Housing Census result, the population of the region is

projected (population growth rate of 3 percent per annum) to be about 24.9 million in the year

2004. The share of rural and urban population is 87.5 and 12.5 respectively. The average

household size was estimated at 4.8 persons (4.5 and 4.9 persons per household for urban and

rural areas respectively). The crude population density of the region was 57 persons per km2.

Agriculture, yet subsistence, is the mainstay of the economy. It is the means of livelihood for

almost all of the rural population, and contributes to 65 percent of Regional Gross Domestic

Product (GDP). Moreover, it is the main source of domestic food production and major supplier

of raw materials to domestic manufacturing industries and source of foreign exchange earnings

(RADSO, 2003). Maize, teff, wheat, barley, sorghum, fababeans, field pea, chickpea, grass pea,

millet, lentils, haricot bean, linseed, noug, rape seed, etc. are some of the widely cultivated

crops in the region. The livestock population of the region is estimated at about 13.6 million

28
Tropical Livestock Unit, (TLU) in 1999/2000. There are also 10 million poultry and 1.5 million

beehives under private holding of peasant (OBFED, 2000).

Land size in the highlands is increasingly diminishing due to high population pressure.

According to land utilization survey conducted in the year 2000, Oromiya region has 4.3

million peasant landholders and 4.9 million hectares of land under different uses. The regional

average land holding per household was 1.13 hectares. This is slightly greater than the national

average, which was 0.97 hectares per household. As production from this small plot could not

cover the household's food requirements, fallowing is practically impossible. Continuous

ploughing coupled with critical shortage of improved seeds and fertilizer largely contributes to

low level of crop productivity (OBFED, 2000).

Although there is a good potential for irrigation, with an estimated 1.7 million hectares and 58

billion m3 of surface runoff, actual utilization is only 5.5 percent of the existing potential land

and 1.5 percent of the surface runoff generated in the region. Hence, crop production in the

region mainly depends on rainfall (RADSO, 2003).

3.2 Socio-economic profile of Weliso District

3.2.1 Physical characteristics:- Weliso district is located in the southern part of southwest

Shewa zone along Finfinne-Jimma main road, extending from 90-140 km from the capital. It

has an area of 1,088.9 km2 and ten urban centres including Weliso town. The Regional State of

Southern Peoples nations and nationalities, and Dendi, Dawo, Becho and Kokir districts of

southwest Shewa zone are bordering Weliso district. Topographically, it is characterized by

plateaus, mountains, hills and plains. Altitude wise, the district lies between 1600 and 2880

m.a.s.l. Simela, Karfefe and Rogda are the major mountains found in the district. Several

perennial rivers (Walga, Rebu, Kono, Menisa, Dedebo, etc.), intermittent streams (Gute, Osole,

29
Boye, Dergu, Atabela. etc.) and springs (Kora, Lencho, Boye, etc.) are found in the district.

Climatically it is classified into Weinadega (70%) and Dega (30%) zones. Chromic and Pellic

Vertisols are the dominant soil types found in the district.

30
Figure1 Map of Southwest Shewa Zone of Oromiya Regional State (2004).

31
3.2.2 Population:- The population of the district is projected at about 244,835 in 2004, of

which 204,511 are rural (103,687 females) and 40,324 are urban (21613 female) population.

Populations aged 0-14, 15-64, 64+ years accounted for 44.2%, 52.4% and 3.4% respectively.

Average family sizes for rural and urban areas were 4.9 and 4.8 persons respectively. The crude

population density of the district is estimated at 176 persons per km2. It is the most densely

populated district from the zone.

3.2.3 Agriculture:-About 61%, 20.2% and 7.2% of the district’s total area is estimated to be

arable (51.6% under cultivation), grazing and forest (including shrubs and bushes) land

respectively, while the remaining is occupied by swampy and marshland, degraded and

residential areas. Average farmland and oxen holding sizes per household were 2.4 and 1.0 ox.

About 34.3% of the farmers were without farm ox. Teff, maize, sorghum, barley, wheat,

chickpea, Fababean, field pea, noug, enset, chat and grass pea are the most widely cultivated

crops

3.3 Socio-Economic profile of Wenchi District

3.3.1 Physical characteristics:-Wenchi district is located in southwest Shewa zone at a

distance that is extending from 119-135 km from Finfinne. The district has an area of 474.6 km2

and one urban center. Ambo, Dendi, Weliso and Goro, and Ameya districts are bordering

Wenchi district. Topographically, it is characterized by plateaus, mountains, hills, plains and

valleys. Altitude wise, the district extends between 1800 and 3390 m.a.s.l. Arba Tensaye,

Sonkole and Haro are the major mountains found in wonchi district. About thirteen perennial

rivers, 20 major springs and Wenchi Lake (8.9km2) are found in the district. Climatically the

district is classified into Dega (44%) and Weinadega (56%). Randzinas, Haplic and Luvic

Phaeozems, Chromic and pellic Vertisols are the major soil types.

32
3.3.2 Population:- Based on the 1994 census, the Population of the district is projected at

about 105,809, of which 104,540 are rural (52897 females) and 1269 are urban (652 females)

populations. Average family sizes for rural and urban areas are 5.0 and 4.1 persons respectively.

The crude population density of the district is estimated at 173 persons per km2. It is the second

densely populated district in the zone next to Weliso.

3.3.3 Agriculture:- Farm land, grazing area and forest ( including bushes and shrubs) land s

accounted for 52.7%, 13.1%, and 10.5% of the district’s total area respectively, while the

remaining was covered by swampy and marshland, degraded and home stead areas. Average

farmland and oxen holding sizes per farmer household are 1.9 ha and 1.0. About 40.1% of the

total farmers had no ox. The most widely cultivated crops are teff, barley, wheat, maize,

sorghum, fababean, grass pea, field pea, enset and noug (OBPED, 2000).

33
 4. METHODOLOGY

4.1 Selection of the Study Area

The study was conducted in two districts (Weliso and Wenchi) of Southwest Shewa zone of

Oromiya Region. The zone as well as the districts were selected purposively using the following

criteria.

1. Both districts are located at the central highlands of the country and the region, where there

is relatively high population densities and strive for meager resource is immense.

2. Both districts have a long history of traditional irrigation practices and indigenous

knowledge. And hence, it is possible to grab the opportunities and capitalize on.

3. There are relatively better irrigation activities in the study area that gives opportunity to

government in developing modern small-scale irrigation schemes. In both districts, in

addition to fifteen traditional schemes, two modern small-scale schemes were constructed

and are operational while the detailed socio-economic and engineering study of one scheme

has been completed.

4. Accessibility of the districts.

4.2 Sampling Techniques

In this study, a multi-stage random sampling procedure was adopted for the selection of sample

respondents. In the first stage sixteen and twelve Kebeles which have access to irrigation were

identified from Weliso and Wenchi districts respectively. Nine sample Kebeles, five from

Weliso and four from Wenchi, were randomly selected.

In the second stage, the total households in the nine Kebeles were stratified into two strata:

irrigation user and non-user households. The lists of total households in the selected Kebeles

and the lists of irrigation user households in these Kebeles were obtained from District Office of

Finance and Economic Development and District Office of Irrigation Development

34
respectively. Then these two lists were tallied and the lists of irrigation non-user households

were obtained. The non-users were selected within Kebeles of irrigation users to ensure

homogeneity of factors except irrigation. Then, the sample respondents from each stratum were

selected via probability proportionate to size procedure. In this procedure, the determined

sample size (one hundred twenty one) was selected from the nine Kebeles proportionally (Table

1).

35
Table 1 Sampled Kebeles and number of sample HHs by Kebele
Number of Number of Total

Irrigation user Irrigation non-user number

District Sampled Kebeles HH HH of

Total Sampled Total Sampled sampled

HH HH HH HH HH

Weliso Bedessa -Koricha 241 9 484 9 18

Chiracha 160 6 275 5 11

Chirecha-wenberi 188 7 250 5 12

Fodu gora 55 2 326 6 8

Gute godeti 221 8 250 5 13

wenchi Dulele kori 105 4 420 8 12

Haro kono 291 11 323 6 17

Lemen metahora 105 4 401 8 12

Meti-walga 321 12 329 6 18

Total 1687 63 3058 58 121

Source: District Offices of Irrigation Development and Finance and Economic Development

4.3 Data Collection

In this study, both primary and secondary data were utilized. To obtain primary data, structured

questionnaire with both closed and open-ended questions were developed. Important variables

on economic, social and institutional aspect of the society in the sampled districts were

collected.

36
Nine enumerators, all from their respective sampled Kebeles, were recruited. Necessary care

was taken in recruiting the enumerators and strict supervision was made during the course of

survey work. The enumerators are all fluent speakers of the local language, Afaan Oromo. They

were given an intensive training on data collection procedures, interviewing techniques and the

detailed contents of the questionnaire. The structured questionnaire was translated to Afaan

Oromo to allow enumerators better understand the questions and properly administer the

interviews.

The questionnaire was pre-tested and adjusted accordingly. The survey work for the collection

of primary data was done in the month of May 2004. It was found convenient to interview two

members of household (the head of household and spouse, where applicable) in order to

improve the accuracy of the data and reduce the problem of memory lapses. The researcher

made close and intensive supervision of the interview process to minimize possible errors that

might occur during data collection. Personal observations of physical features, informal

discussions with farmers and DAs of the selected Kebeles were also made.

Moreover, secondary data were obtained through discussions with concerned expertise and

officials of line-offices of the respective districts. District Offices of Irrigation Development

(DOID), District Offices of Rural and Agricultural development (DORAD), District Offices of

Finance and Economic Development (DOFED), are some of the district offices from which

secondary data were obtained. Ministry of Agriculture and Rural Development (MOARD),

Ministry of Water Resource Development (MWRD), Oromiya Bureau of Agriculture and Rural

Development (OBARD), Oromiya Bureau of Finance and Economic Development (OBFED)

and Oromiya Irrigation Development Authority (OIDA) were also the sources of secondary

data.

37
4.4 Method of Data Analysis

4.4.1 Descriptive Analysis

Depending on the objectives of a given study and nature of data available, analysis to be made

requires different approaches. There are objectives that require descriptive analysis and others

may require econometric models that have power to estimate relationships and allow verifying

or refuting statement of the theory or hypothesis of the problem at hand (Cochran, 1977).

In this study, both descriptive analysis and econometric models were employed. The descriptive

analysis was made using frequencies, means, and maximum and minimum values of some

important variables. Econometric models were used to estimate the relationship between the

variables of our concern and the hypothesis regarding these variables was tested.

4.4.2 Econometric Model

It is hypothesized that provision (the use) of irrigation is expected to have immediate effect on

cropping intensity resulting in larger production and higher income from both crop outputs,

trading of outputs and inputs. To be specific, irrigation user households will have higher income

than the irrigation non-user households. Although, the income of a household is determined by

a wide variety of factors, data are not available for some of the factors and such factors were not

included in the analysis.

Thus the income analysis in this study has been done following the regression technique in

linear form. The following regression model was employed to estimate the determinants of

household income.

Yi =β0 + β1D1+ β2X2+β3X3+β4Χ4+…+βnΧn+ui …………….. (1)

Where Yi = the annual household income

X2, X3,...,Xn are the explanatory variables

38
 D1 = 1 if a household has access to irrigation

0 otherwise

β0- is the intercept

β1, β2,…, βn are the coefficient of the parameter (slopes)

ui, represents the error term

Economic efficiency has two components: technical efficiency and allocative efficiency. The

former refers to the ability to obtain the highest amount of output with given amounts of factor

inputs. The latter is the concept of efficiency in which resources are allocated in the profit-

maximizing sense so that the marginal value products of resources are equal to their unit prices.

The crucial task for any technique used for efficiency measurement is the empirical

measurement of the unobservable frontier. Two methods have been developed to this end:

parametric and non-parametric approaches. The main difference between them lies in the way

the production possibility frontier is estimated. The non-parametric approach does not require

an explicit specification of its functional form, however, the parametric frontier does require an

explicit specification of its functional forms.

The parametric approach can be either deterministic or stochastic depending on the modeling of

the random noise, which is ignored in the deterministic model but explicitly accounted for in the

stochastic model. The variables used to explain technical efficiency (TE) differences are called

determinants of TE. They typically include education, geographical distribution, specialization,

participation in program of any kind, etc.( Brummer, 2001).

39
In most studies a Cobb-Douglas production function is applied to estimate the average

production function. The estimated average production function is compared with the frontier of

all observation. Deviations from single observations to the average production function frontier

provide measures of technical inefficiency. Obviously, random deviations (white noise) can

significantly affect the degree of deviation of each observation from the average production

function frontier and thereby affect the measure of technical efficiency (Brummer & Loy,

2000). To address this problem, as it is cited in Brummer &Loy (2000), the consideration of

random variable (white noise) in technical efficiency analysis was developed by Aigner et al

(1977), Battese and Corra (1977), Meeusen and Van den Broeck (1977).

In general TE model is extended by a white noise error term vi as shown in equation three. The

resulting equation is labeled as a stochastic frontier production function. There are two

approaches to the measurement of technical efficiency: output oriented approach (often referred

to as primal approach) and input-oriented approach (often referred as dual approach). In the

primal approach the interest is by how much output could be expanded from a given level of

inputs, hence known as output-shortfall. In the input-oriented approach, the concern is the

amount by which all inputs could be proportionately reduced to achieve technically efficient

level of production, hence, known as input over-use.

In this study preference has been made to the primal approach, given the settings of developing

country, the major concern is not that inputs are over-used rather output-shortfall. Then, for

estimation of technical efficiency and agricultural production of households, the stochastic

production frontier of Cob-Douglas production function type was employed, which is indicated

as follows.

Y= f ( xi,β) eφ …………………………….. (2)

40
 Where: Yi is the annual total agricultural output of household expressed in monetary

value (in Birr).

f ( xi,β) and eφ, respectively, represent the deterministic part and the stochastic part of

the production frontier, φ represents the random error term, and β is a

vector of parameter to be estimated.

Besides allowing for technical inefficiency such stochastic production frontier models also

acknowledge the fact that random shocks outside the control of the farm operator can affect

output. But more importantly, the stochastic production frontier models provide a great virtue

that the impact of shocks due to variations like in vagaries of weather, etc on output can at least

in principle be separated from the contribution of variation in technical efficiency (Kumbhakar,

2000).

The total error term in equation (2) could be decomposed into its respective two components as:

φ = vi + uI ………………………………….. (3)

Where v is the symmetric error term accounting for random variations in output due to factors

outside the control of the farmer, where as, u represents the technical inefficiency related to the

stochastic frontier and assumes positive values.

The distribution of the symmetric error component v is assumed to be independently and

identically as N(0,σ2v). The normal error term provides the production frontier to be stochastic

and, hence, allows the frontier to vary across or over time for the same producer. However, the

distribution of the one sided component u is assumed to be half-normal. That is, it assumed to

be identically and independently distributed as N(0,σ2u) and it follows that

σ2 =σ2v + σ2u ……………………………………….. (4)

41
Considering that f (xi, , βi) takes the log-linear Cobb-Douglas form, then the stochastic

production frontier model in equation (2) could be rewritten as follows:

lnyi = ln f (xi, β) + vi - ui ………………………. (5)

Once the model is specified as in equation (5), the parameters of the stochastic frontier model

can be estimated using maximum likelihood estimation procedure. Following the estimation, the

white noise and farm technical inefficiency effects can be decomposed since, the assumptions of

statistical distributions of v and u would allow as generating the conditional mean of u.

A Cobb-Douglas functional form which includes both the conventional inputs and exogenous

factors believed to affect inefficiency was the one considered in this specific study. The final

version of the model estimated is indicated as below.

lnY = β0 + β1 lnL + β2 lnH + β3 lnK + β4 lnOX + δ0+ δ1Age + δ2L +

δ3DDA + δ4PEXT + δ5IRR + ε ………………….(6)

where, Yi represents the monetary value (in Birr) of annual total crop output of

household,

β1,…,β4 are the coefficients of parameter estimates of input variables,

L represents the total cultivated land holding of household in ha,

H is total human labor in man-days utilized,

K represents total value (Birr) of other agricultural inputs utilized,

OX is a total ox power (oxen-days) utilized,

Age, is age of household head (years),

42
 DDA represents distance (km) between the development centers and the

sampled household residence,

PEXT is a dummy variable having the value of 0, if household has

participated in the extension package program and 1 if household did

not participate in extension package program,

IRR is a dummy variable having value of 0 if household has access to

irrigation technology and value of 1 if household has no access to

irrigation technology,

δ1,…,δ5 are the coefficient of parameter estimates of the inefficiency

variables and,

ε, is the disturbance term included in the model.

4.4.3 Measurement of Variables

Farm production (annual total agricultural output) under consideration was the 2003/2004

production year farms output values of crop and livestock production.

In case of valuation of crop production, the monthly prices of agricultural output at each district

market were taken from the Zonal Office of Disaster Prevention and Preparedness (ZODPP).

The agricultural output price data was primarily collected for the purpose of Early Warning

System.

4.4.4 Definition of Variables and Hypothesis Setting

4.4.4.1 Definition of determinants of household income

The dependent variable: In the estimation of the impact of irrigation on household income and

technical efficiency, the dependent variable is the annual household income. Annual household

income included both agricultural (farming and non-farming) and non-agricultural off-farm

incomes. The non-agricultural or income obtained from off-farm activities was considered

43
because, income that could be obtained from irrigation activity can be compensated by non-

agricultural or off farm activities. The contribution of irrigation to household income might be

exaggerated if the inclusion of non-agricultural or income obtained from off-farm activities is

ignored. It means that if the household income from non-agricultural or off farm activities is

omitted and only agricultural income is considered the share of income obtained from irrigation

activities might be higher than when income from both agricultural and non-agricultural or off

farm activities are considered. Therefore, as much as possible, it is plausible to include every

source that can generate income to household.

The explanatory/ independent variables: Variables that tend to explain a given dependent

variable are said to be explanatory or independent variables or regressors. The income of a

household is determined by a wide variety of technical and social factors. The technical factors

in crop production include mainly land topography and type of input used. Among the social

factors, individual and family characteristics are quite important.

Based on theoretical relationship and findings of empirical studies, the following explanatory

variables were hypothesized to explain the dependent variable. These explanatory variables are

discussed as below.

Total cultivated land: This refers to the total area of farmland that a farm HH cultivated in

hectares. In agriculture, land is one of the major factors of production.

The availability of cultivable land enables the owner to earn more agricultural output, which

imply more income ceteris paribus. Therefore, land holding and improvement in the income

level are expected to have direct relationship.

44
Household agricultural labour: In Ethiopia, as in most of other developing countries, labour is

one of the most extensively used input of agricultural production. Furthermore, family is the

major and sole source of agricultural labour. Households with large family size will have more

number of agricultural labour and hence, will have more agricultural production and more

income provided that there is sufficient land to employ the existing labour. Therefore,

household family size has a direct influence on income level of the family.

Amount of credit received by household: capital is the major ingredient in starting-up or

running any business activity, be it agricultural or non-agricultural businesses. In subsistence

farming, like ours, where there is a severe household capital deficiency, credit is a substitute,

which should not be overlooked. Credit enhances the use of agricultural inputs where capacity

determined. Hence, the amount of credit received has direct relationship with the improvement

in the income level.

Education level of the household head: This refers to of formal schooling a farm household

head completed. Formal education enhances farmers' ability to perceive, interpret, and respond

to new events in the context of risk. Education is, thus, hypothesized to increase the probability

of farmers’ adoption of new technologies and hence increases household income.

Amount of fertilizer used: The use of fertilizer will increase the productivity of a given land.

Improvement in productivity will ultimately lead to improvement in income level.

Livestock ownership: In small holder agriculture oxen are the main source of draught power

and are important elements next to human power in agricultural power supply. In a mixed

agricultural system livestock are kept primarily to serve as a source of oxen power and secondly

45
as a source of heifers for replacement stock and for milk production. Household with large

number of livestock will not face draught power constraint and increases the possibility of

maximizing output. Moreover, in cases where households own more number of livestock which

could mean more number of oxen than they require, can hire or lease-out oxen so that

households generate income from the lease. Moreover, households that have got large number

of livestock can fatten those that are not immediately used for draught power, replacement and

milk production and hence generate additional income. Therefore, the number of livestock

owned by a household will have direct relationship with improvement in income level.

Access to irrigation services: Irrigation, as one of the technology options available, enables the

farmers to diversify their production, practice multiple cropping and supplement moisture

deficiency in agriculture. In doing so, it helps the farmer to increase production. It is assumed to

have a direct relationship with household income and entered the model as a dummy variable.

4.4.4.2 Definition of production frontier and technical inefficiency variables

Dependent variable: In the estimation of production frontier and technical inefficiency

variables, the whole crops grown by specific sample household were considered. Hence,

household annual income generated from annual crop production (teff, maize, wheat, barely,

sorghum, faba beans, chickpea, field pea, onion, tomato, and potato are the major ones) was

considered as the dependent variable. This is so because, in the study area the most common

crops produced under irrigation are horticultural crops such as onions, tomatoes and potatoes

and very little of cereals such as maize are grown. The horticultural crops are not produced

under rain-fed. While both households produce different crops under rain-fed. Hence,

estimation of production function frontier and technical inefficiency for specific crop and

comparison of production and efficiency of irrigation user and irrigation non-user households,

46
where one is not producing the crop under consideration, would be extremely difficult and

misleading. Therefore, it was believed that considering all crops grown by sample households

would better represent the production system in the study area. To minimize bias and variations

among each respondent in estimating the values of crop output, annual average crop price at

corresponding district was used. Similarly, with regards to the input prices, the average of the

two seasons (belg and meher) bid prices 2of the input at corresponding districts was considered.

The explanatory/ independent variable: in here four factors of production and five farm

specific inefficiency variables are believed to explain the dependent variable and represent the

production system in the study area.

Variables of production frontier

Total cultivated land (L): This refers to total area of farmland that a household cultivated in

hectares and used for crop production (rain-fed and irrigated) in the year under study. This will

not include that part of household land holding that is maintained for grazing, animal feed

production and area under perennial/ permanent crop. As crop output is a function of land as a

factor of production, households with larger cultivated land is assumed to get higher output than

households having lesser cultivated land. Therefore, it was hypothesized that the size of

cultivated land will have positive relationship with total crop output.

Labour input in person-days: Labour is one of the major inputs used in agricultural

production. Given the state of technology and other factors of production, the higher the amount

of labour utilized the higher the level of output.

2
Bid price of input, in this context, is the least price that the suppliers of agricultural inputs ( fertilizers and
agro-chemicals in this case) offered for their inputs at particular place and time.

47
Thus, the amount of labour (person-days) utilized is assumed to have positive relationship with

the total out put level.

Other agricultural production inputs utilized: Agricultural inputs such as fertilizers, seeds

(improved or local) and agro-chemicals are crucial factors of production in increasing

production and productivity. The use of these inputs at their specific recommendation level was

sought to increase production and productivity of the input variables and hence, in this study,

hypothesized to have a positive relationship with total crop output. This variable was

transformed in to monetary value (Birr) and entered in to the model.

Oxen power utilized in oxen-days: in smallholders farming, oxen power is an important

element next to human power in agricultural power supply.

Given that other factors of production are not limiting, the higher the amount of oxen days

utilized by households implies higher amount of crop output. Therefore, it was hypothesized

that the amount of oxen power utilized in oxen days will have a positive relationship with total

crop output.

Variables of technical inefficiency

Age of household head (years): In peasantry farming system; the types of crops grown, the

technology used, the allocation of resources among enterprises, etc. are largely determined by

the decisions of farm household head. Age, as one of the developmental characteristics of

human being, considerably influences the decision making process. The decisions regarding

methods of production, resource allocation, mix of enterprises, use of technology, etc. that the

household head makes in turn affect the technical efficiency of household. Therefore, as age

advances household heads become much reluctant to accept new production styles and

48
technologies. Most of the times they come up with options they have experienced in the past no

matter superior the new styles and technologies are. Therefore, age of household head is

hypothesized to negatively contribute to technical efficiency of households.

Distance of household's residence (in Km.) from the development center: Distance between

farmer's residence and development center is assumed to have negative impact on efficiency.

This is because the development agent requires longer time to visit the farmer and provide

technical advice or vice versa and the frequencies of visits may reduce.

Household's participation in the extension package program: The ongoing extension

package program is composed of a package of technologies (proper types and rates of fertilizer,

improved varieties of seeds, agro-chemicals, etc.) and modern production (cultural) practices.

Thus, the household's participation in the extension package program is supposed to increase

production, productivity and technical efficiency of household and entered the model as a

dummy variable.

Access to irrigation: it was envisaged that the use of improved and appropriate technology

would improve the technical efficiency of the farmer. Therefore, it was hypothesized that

households having access to irrigation are more efficient than those without access. The variable

entered the model as dummy variable.

Total cultivated land (ha), (L): cultivated land was considered to positively influence the

technical efficiency of the farmer. The logic behind this reasoning could be due to the fact that

as a result of population pressure in the study area, land is getting scarce. And farmers have no

49
over-sized land holding that could create inconvenience in management and results in

inefficiency at the current managerial capacity of the farmer.

50
Table 2 Summary of definitions and measurements of variables used in the models.

Unit of

Variables Definitions measurements

Income determinants

Family size Number of persons in a family number

L Total cultivated land holding Hectare (ha)

Credit received Total credit received in cash or in kind Birr

Education Formal schooling of the household head years

Livestock ownership Total livestock owned per household TLU

Access to irrigation Households access to irrigation technology Dummy

1 if has access, 0 otherwise
Production frontier variables

ln L Total cultivated land holding Hectare (ha)

ln H Total human labour utilized for crop Person-days

production Equivalent (PE)
ln K Total value of agricultural inputs Birr

ln OX Total oxen power utilized foe crop production Oxen-days

Inefficiency variables

Age Age of household head Years

L Total cultivated land holding Hectare (ha)

DDA Distance of a farmers residence from Km.

Development center.
PEXT Participation of a farmer in extension package Dummy
1 if not participating, 0 otherwise
IRR Households access to irrigation technology Dummy

1 if has no access, 0 otherwise

51
4.4.5 Estimation Procedure
It is statistically desirable to sort out problem of multicollinarity among the continuous variables

and check the association among discrete variables before estimating a model. The term

multicollinarity refers to a situation where two or more explanatory variables can be highly

linearly related. The consequences of multicollinarity are as follows. In the case of perfect

multicollinarity we cannot estimate the individual regression coefficients or their standard error.

In case of high multicollinarity individual coefficients can be estimated and the OLS estimators

retain BLUE3 property, but the standard errors of one or more coefficients tend to be large in

relation to their coefficient values, thereby reducing t values.

Multicollinarity is essentially a sample (regression) phenomenon in the sense that even if the X

variables are not linearly related in the population (i.e, population regression function), they can

be so related in particular sample. When we postulate the population regression function (PRF),

we believe that all X variables included in the model have a separate or independent effect on

the dependent variable Y. But it can happen that in any given sample that is used to estimate

the PRF some or all X variables are so highly collinear that we can not isolate their individual

influences on Y. .

For all these reasons, the fact that OLS estimators are best linear unbiased estimators (BLUE)

despite (imperfect) multicollinarity is of little help in practice to consider that the estimation and

hypothesis testing are free from flaws (Gujarati, 1999).

3
If an estimator is linear, is unbiased, and has a minimum variance in the class of all linear unbiased
estimators of a parameter, it is called a best linear unbiased estimator or BLUE (Gujarati, 1999).

52
Therefore, the correlation coefficients and a variance inflation factor (VIF) techniques were

employed to detect the problem of multicollinarity (Gujarati, 1999). In the case of the variance

inflation factor technique, each selected explanatory (Xi) was regressed on all other explanatory

variables, the coefficient of determination (Ri2) constructed in each case was evaluated to detect

whether multicollinearity is a serious problem.

VIF (βi) is defined as

VIF (βi)= (1-Ri2) -1 …………………….(7)

Where, Ri2 is the squared multiple correlation coefficient between Xi and the other explanatory

variables (Maddala, 1992).

53
 5. RESULTS AND DISCUSSION

5.1 Household Characteristics

In an agrarian society, household members are the major source of labour for agricultural

activities. The household characteristics such as age, rate of dependency, educational levels

etc. differ from one household to the others. The details of these characteristics for the

sampled households in the study area are depicted in Table (3).

Table 3: Family size and other household characteristics of sampled households

Household characteristics Irrigation Irrigation Total

users Non-users

N Mean N Mean Minimum Maximum Mean SD

Age of HH head in years 63 48.44 58 49.62 23 76 49.01 13.31

level of formal education of HH

head in years 32 6.94 15 5.27 1 12 6.40 3.02

Number of family members 63 6.38 58 6.09 2 13 6.24 1.87

No of family members involved

on Agri-activities 63 2.59 58 2.53 1 7 2.56 1.27

No of years of irrigation

experience 63 12.50 - - 2 36 12.50 7.25

SD, represents Standard Deviation

54
The average family sizes of the sampled households in the study area is 6.24 persons, with

2 and 13 being the minimum and the maximum family size respectively. The number of

family members involved on agricultural activity ranges from 1 to 7, with the average

figure of 2.56. Moreover, the mean ratio of total family size to active agricultural labour

was found to be 1: 0.42, implying that there is relatively high dependency. There is a large

variation with respect to the age of the respondents. The age of the sampled household

head varies from 23 to 76 years, the average being 49 years. Regarding educational

background of household head, 39 percent of the sampled household heads are literate

while 61 percent are illiterate. The model output also revealed that the educational level of

the literate household heads ranges 1-12 years of schooling. The mean educational level of

the literate household head is 6 years.

In addition to family labour, oxen power plays a significant role in peasant agricultural

production activity. Nearly 9 percent of the sampled households have no ox; 91 percent of

the household own 1 to 6 Oxen, with the mean being 2 oxen. Moreover, about 4 percent of

the sampled household do not have any kind of livestock. On average the sample

household own 5 TLU, the minimum and maximum livestock size owned per household

being 0.2 and 12.8 TLU, respectively.

55
 Table 4. Household resource endowments at the beginning of 2003/2004

Irrigation Irrigation total

Household characteristics users Non-users

N Mean N Mean Minimum Maximum Mean SD

Total landholding in ha. 63 2.16 58 1.50 0.33 4.00 1.85 0.73

Number of Oxen per HH 60 2.18 50 1.94 1.00 6.00 2.07 1.03

Number of TLU per HH 61 5.59 55 4.29 0.20 12.8 4.97 2.53

The landholding of the household varies from 0.33 to 4 ha, the average being 1.85 ha per

household. The model outputs described above clearly indicate that there is relatively high

labour congestion in the study area. This is so, because, the mean ratio of a full time

agricultural labour to total landholding was found to be 1: 0.7. This does not account for

the occasional supply of child and aged person's labour, which is usually the case

especially during peak times.

56
 Table 5: Household income, credit and input use

variables Irrigation users Irrigation Non-users

N Min Max Mean N Min Max Mean

Total HH income in Birr 63 1069 10541 4954 58 573 6006 2437

Amount of credit received/HH 63 0.00 2918 493 58 0.00 629 262

Amount of fertilizer used/HH in

kg 63 0.00 600 229 58 0.00 300 133

Amount of improved seeds

used/HH in kg 31 5.00 87.50 32.7 17 6.50 12.5 7.79

5.2. Characteristics and Functioning of irrigation schemes

Before we discussing the survey results with respect to irrigation, it is essential to describe

what does community managed irrigation means in the context of this particular study.

Community managed irrigation system is an irrigation scheme in which the user

community performs all or part of the activities of irrigation management. The physical

activities such as operation and maintenance of the existing schemes, development of new

schemes, organization and formulation of by-laws for Water Users Associations (WUAs),

ensuring equitable water distribution and mobilization of community labour and financial

contributions for the sustenance of the schemes are performed by the community.

Moreover, the community delegates representatives to deal with the government on issues

of irrigation development. These are some of the major roles of the community in

community managed irrigation system.

57
In the nine sampled Kebeles, there are 17 river and spring diversion irrigation schemes.

The names of schemes and Kebeles that are using these irrigation schemes are presented in

Appendix (4). All the schemes were primarily initiated by the local community and they

vary in capacity. Written documents are not available regarding the time when these

schemes established. The community members estimated that the year of establishment of

schemes could go back to 40-50 years. All the schemes were formerly traditional ones

which were diverted using locally available materials such as stone, wooden poles and

trusses fixed using ropes or nailed together to enforce earthen dams. The earthen dam

obstructs the water from its main course and diverts it to the irrigation canal. It is from the

irrigation canal that communities down the line get water for irrigation. The diversion

works are rudimentary, and require frequent repairs, which involve great expenditure of

labour on the part of the beneficiaries. The diversion weir lacks spillways for overflow and

hence is usually taken or destroyed by the in bounded water or heavy flood during the

rainy season. Currently, out of the seventeen traditional schemes, two have been

rehabilitated and developed to modern small-scale irrigation schemes.

These modern small-scale irrigation schemes were developed by Oromiya Irrigation

Development Authority (OIDA). The community participated in the rehabilitation of the

scheme through provision of labour for excavation of canals and head works, supply of

locally available construction materials such as stone, sand or gravel. At completion,

OIDA had handed-over the schemes and all the management to the community through

their representative.

The modern small-scale as well as the traditional schemes in the study area are totally

managed by the community. However, the Districts Irrigation Development, Cooperative

58
Promotion and Agricultural Development offices render technical and organizational

supports to the user community.

From the group discussion held during the survey period, it has been observed that the

activities of water distribution and all management aspect of the schemes are performed by

Water Users Associations (WUA) of the respective scheme. The communities also

revealed that the Water Users Association Committee is an elected body and accountable

to the general assembly of the association. Each Water Users Association Committee acts

according to the by-law of WUA and each member of the WUA accepts and respects the

by-law after it is endorsed by the general assembly.

Moreover, the Water Users Association Committee members serve the community on a

voluntary basis and do not claim any privilege against the services they render. The

management system proved effective in many instances, evidencing farmers' ability to

organize themselves and to manage small-scale irrigation systems. The community had its

own endogenous and practical knowledge regarding irrigation management. In this

participatory approach of irrigation management, the community provides the necessary

supports for the sustenance of the system. This system had been practiced over many

decades. The endogenous irrigation management practices, the principles used for the

formulation of by-laws, the systems and objectives of the Water Users Association

Committee can be taken as very important points on which the government can capitalize

in the course of enhancing community based rural development.

The survey result indicated that all the irrigation users sampled, (63) responded that,

regardless of any given difference among irrigation user households, irrigation water

59
distribution is faire and on equal basis. That means, it does not consider variation in age,

social or political position, size of land, gender and religion. Equity in water distribution is

a strong factor. However, it gives due attention to tail irrigation user households and sets a

given safety margin (in hours) for the water to reach the tail irrigation users farms. This is

done if the tail irrigation users' farms are very much far away from the average farms of the

rest of irrigation users. Otherwise, the delay will be distributed over all the farms of the

irrigation users and offset the burden tail irrigation users would have faced.

The irrigation in the study area (both traditional and modern small-scale) is a complement

to rain-fed agriculture, and the crop grown are often horticultural crops especially, onions,

potatoes and tomatoes. Similar result has been reported by Desalegn, (1999).

All the sampled irrigation users responded that they never paid for water for irrigation.

And this is what actually practiced in the country as a whole. In an evaluation report of

OIDA, (2000) it is clearly stated that for now the government considers irrigation water as

free good. This is so, not because irrigation water provision is without cost, but the

government has chosen to subsidize costs of developing small-scale irrigation projects. The

failure to recognize irrigation waters economic value and the real cost of service provision

is likely to bring about wasteful and environmentally damaging uses. Hence, managing

water as an economic good is an important way of achieving efficient and equitable use, as

well as encouraging the conservation and protection of scarce water resources. Moreover,

it is anticipated that government is not committed to cover the costs of Operation and

Maintenance (O & M) of those schemes that do not require major maintenance (OIDA,

2000). Moreover, low level of irrigation technology and lack of awareness of the

60
community might be cited as the core problem for the community to consider water as a

free good.

Majority of the irrigation users and irrigation non-users sampled in the study area reported

that there is a market problem for their produces. The problem is much severe when it

comes to irrigation users who produce horticultural crops. Horticultural crops are highly

perishable and farmers are forced to give away their produce at low prices that market

offered. Moreover, the sampled respondents claimed that the prices of fertilizers are

getting dearer from year to year. The average agricultural product and input prices at the

study area for the period (2003/2004) is indicated on Appendix (3).

5.3. The Models Results

5.3.1 Determinants of Household Income

The income of a household is determined by wide arrays of factors both technical and

social. In addition to the descriptions given above, the income analysis in this sub-section

was estimated using the linear regression model. The study has tried to address the

objective and give empirical analysis. The preposition that stated there exists no significant

income differentials between households using irrigation and those who do not use

irrigation was tested against the alternate preposition. A Multiple linear regression analysis

was carried using software called Statistical Package for Social Scientists (SPSS). The

dependent variable considered in the analysis is the total annual household income derived

from both agricultural and off-farm activities. The output of the model is depicted in Table

(6).

61
Family size, farm size, volume of credit received, education of household head, livestock

ownership and access to irrigation technology are the independent variables assumed to

explain the dependent variable. Depending on economic theories and data availability, the

variables believed to influence the income of the farming household have been included.

However, it doesn't mean that the variables included are exhaustive. Moreover, at the

initial stage the amount of fertilizer utilized by a household was proposed to be included in

the model, but at the time of analysis, the variable was found to have multicollinearity with

credit received and the total land holding of the family. This is so because the major part of

rural credit is spent on agricultural inputs and households with more land tend to use more

fertilizer and households with less land tend to use less fertilizer. Hence, the variable was

excluded from the model.

As expected, most of the coefficients of the explanatory variable included in the model

have positive sign. Family size has a negative sign. However, it was found to be

insignificant implying that it is not different from zero. Therefore, having a negative sign

could only be related to chance. The positive sign of the coefficients indicate that the

explanatory variables estimated influence the dependent variable positively. However, the

level of significance varies from one independent variable to the other. In testing of the

hypothesis H0: b=0 against the alternative H1: b is different from zero, livestock ownership

and education of HH head are significant at 10% and 5% significant levels respectively.

Amount of credit received, farm size and access to irrigation are significant at less than 1%

significant level. The coefficient of the family size was found to be insignificant. More

importantly, the amount of credit received, farm size and access to irrigation have

significant contributions to household income.

62
Table 6: Output of the regression model of income determination

Un standardized Stan. 95% confidence

coefficient coefficient interval

Variables B ST.error Betta t value Lower Upper

Bound Bound

Constant 331.36 458.76 0.722 -577.43 1240.16

Family size -63.156 61.83 -0.054 -1.021 -185.64 59.33

Farm size 942.12 205.39 0.317∗∗∗ 4.58 535.22 1349.00

Amount of credit

received 2.247 0.40 0.352∗∗∗ 5.62 1.45 3.03

Education 72.36 32.31 0.122∗∗ 2.24 8.36 136.37

Livestock ownership 95.19 50.01 0.117∗ 1.903 -3.88 194.26

Access to irrigation 1112.6 253.37 0.258∗∗∗ 4.39 610.68 1614.53

R2 value 0.705

Adjusted R2 0.690
∗∗∗, ∗ ∗, ∗
- Significant at 1%, 5% and 10% significant levels, respectively

As indicated in Table (6), the coefficient of determination and the adjusted R2 values are

0.70 and 0.69 respectively. It means that about 70% of the variation in the dependent

variable are explained by the independent variables, indicating relatively high explanatory

power of the model.

In testing the hypothesis that H0: b1, b2, b3, b4, b5, b6=0, against the alternate hypothesis H1:

b1, b2, b3, b4, b5, b6 is different from zero, the F statistics was employed. The F value

63
obtained is significantly different from the critical value of F at 6 and 114 degrees of

freedom for numerator and denominator respectively, at significance level of 1%. This can,

thus, entail that the explanatory variables included in the model jointly influenced total

annual household income. The model output revealed that the null hypothesis is rejected.

The regression results show that in rural areas household income is more significantly

affected by total land holding, the volume of credit received and the use of irrigation. The

result also strengthens the finding of Quasem (1994). Education level of household head

and the number of TLU household own have a positive contribution to household income.

All these factors have differential levels of contribution.

Two methods were used to examine the presence of multicollinearity problem. In the first

method, the correlation coefficient between any pair of explanatory variables was

estimated to detect the presence of multicollinearity. The values of correlation coefficient

are small and tend to show that there is no as such a serious multicollinearity problem

(appendix 3and 4). In addition, the values of VIF are very low, and therefore, there is no

serious multicollinearity problem among the variables included in both models (appendix

5).

5.3.2 Technical Efficiency Measure

This section presents the levels of technical efficiency and examines the variation in

technical efficiency of irrigation user and irrigation non-user sample households. The

purpose of efficiency measurement was clearly described in the works of Abrar (1995),

Abay et al. (1996) and Corppenstedt et al. (1996).

64
To measure the existence of efficiency differential among the sampled rural households of

both groups, the Cob-Douglas production function described in Chapter 4 was estimated

using the FRONTIER Computer Program Version 4.1 (Coelli, 1996).

In determining the explanatory power of the fitted model the coefficient of determination

(R2) was calculated and tested. The calculated R2 value was found to be 0.80, which

implies that the fitted model has got good explanatory power. However, to be sure about

the explanatory power and determine goodness of fit of the model, investigating in to the

ANOVA table was found essential. The calculated F value was found to be 120.321. The

obtained value was higher than the tabulated critical F value with degrees of freedom 4 and

116 for the numerator and the denominator respectively and highly significant. Therefore,

it can be concluded that the fitted model has got high explanatory power.

Moreover, in the course of searching whether there exists a superior model that can capture

input and inefficiency variables, the Translog production function frontier was compared

with Cobb-Douglas production function frontier. To this end, the likelihood ratio method

was employed to test a model whether it estimates the parameters more efficiently than the

other model. The values of the likelihood ratios of each model was evaluated against the

tabulated critical χ2 values. This is indicated in Table (7).

65
Table 7 Likelihood functions and Likelihood ratios of both the Cobb-Douglas and
Translog production function frontiers.

Method of Log-likelihood Value of likelihood Critical Decision

estimation function value ratios χ2(m∗∗) regarding null-

value hypothesis

OLS -9.244

Cobb-Douglas 7.4033 -2(-9.244 - 7.4033) = χ2 ∗(7) Rejected

33.306 =18.475

Translog 14.922 -2(7.4033 -14.992) = χ2 ∗(10) Accepted

15.0382 =23.209

∗, Indicates the χ2 values at less than 1 percent significance level; and ∗∗, represents the χ2degrees of
freedom which is obtained by subtracting the number of estimated inputs and inefficiency variables of the
preceding model from the current model

As indicated in table (7) the estimated likelihood ratios were found to be 33.306, and

15.0382 for the Cobb-Douglas and Translog production function frontiers respectively.

The χ2 values at less than 1 percent significance level were 18.475 and 23.209 for the

Cobb-Douglas and Translog production function frontiers respectively at their respective

degrees of freedom. Moreover, the likelihood ratio of the Cobb-Douglas production

function frontier was found to be larger than the tabulated χ2 value whereas, the likelihood

ratios of the Translog production function frontier is less than its respective tabulated χ2

value. Therefore, the null hypothesis that states the Translog production function estimates

equivalently as the Cobb-Douglas production function estimates is accepted. Hence, the

Cobb-Douglas production function model was found to be sufficient to estimate the input

variable as well as the inefficiency parameters.

66
The combined result of the OLS and ML estimation of the production function of the

irrigation user households and non-user households is illustrated in Table 10. The purpose

of this estimation is that, technical inefficiency is measured in terms of the deviations of

each firm's output from the maximum attainable output. Hence, each firm's output is

measured against the fitted regression line. Moreover, the regression lines fitted for the two

groups of sampled households are different and comparison of inefficiency of households

belonging to different group with different regression line or reference point is extremely

difficult and misleading. Therefore, the combined result of the OLS and ML estimation of

the production function for the two groups is presented to indicate, how much each groups

are efficient or inefficient compared to the overall mean technical efficiency value. The

results of the efficiency estimates using frontier production function analysis for the

sample households of the two groups are presented in Table 8.

67
Table 8: Results of the OLS and ML Estimation of the production function

variables parameters Estimated value Estimated value

Irrigation users Irrigation non-users

OLS MLE OLS MLE

Constant α0 4.024∗∗∗ 4.32∗∗∗ 4.363∗∗∗ 4.752∗∗∗

(5.131) (5.795) (5.739) (6.818)

Ln land β1 0.447∗∗ 0.465∗∗∗ 0.318∗∗ 0.284∗∗

(2.996) (3.374) (2.405 ) (2.854)

Ln labour man-days β2 0.037 0.043 -0.171 -0.097

(0.219) (0.266) (-1.54) (-0.961)

Ln total input (in birr) β3 0.585∗∗∗ 0.572∗∗∗ 0.383∗∗∗ 0.339∗∗∗

(7.091) (7.101) (7.457) (5.950)

Ln oxen-days β4 -0.064 -0.077 0.326∗∗ 0.283∗∗

(0.513) (-0.610) (2.573) (2.778)

Log-likelihood function 2.199 2.405 6.193 9.827

δ2 =δ2u+δ2v 0.059 0.090∗∗ 0.051 0.119∗∗∗

(2.147) (3.709)

γ= δ2u/δ2u+δ2v 0.618∗ 0.994∗∗∗

(1.63∗) (14.991)

Mean efficiency 0.83 0.78

Number of households 63 63 58 58

Note: Figures in parentheses are t ratios,

∗,∗∗,∗∗∗, indicate 10%, 5%, and 1% significance level

68
Although, it is of less importance for comparison of the level of technical efficiency of the

two groups of households, some useful generalizations can be derived from the model

output depicted in Table 8. The maximum likelihood estimates of the variables included in

the model showed varying degrees of relative importance between the groups.

As indicated in Table 8, despite the fact that the estimated coefficient of land is significant

in both irrigation user and non-user households, the level of significance was 5 percent and

1-percent for irrigation non-user and irrigation user households respectively. Moreover, the

estimated coefficients of the input variable land were found to be 0.465 and 0.284 for

irrigation user and irrigation non-user households respectively, indicating the greater

marginal contribution of land to agricultural output when irrigation technology is in place.

Further more, the estimated coefficients of capital were 0.572 and 0.339 for irrigation user

and irrigation non-user households respectively and significant at less than 1 percent

significance level. However, the coefficient of capital for irrigation user households is

greater than the input's coefficient for non-user households implying that the marginal

productivity of capital is larger for irrigation users than marginal productivity of capital for

irrigation non-users. Therefore, it can be observed that the use of irrigation has improved

the marginal productivity of other variable inputs to agricultural output and hence

increased the efficient utilization of land and capital.

The coefficient of input variable labour was 0.043 and -0.097 for irrigation user and

irrigation non-user households respectively and found to be insignificant in both cases. In

contrast, the coefficient of oxen-days utilized is larger (0.283) and significant for irrigation

69
non-user households than its coefficient (-0.077) for irrigation user households, indicating

the relative importance of animal power for rain-fed agriculture.

With respect to the inefficiency measurement in both groups, the gamma value for

irrigation non-user households is higher than the value for irrigation user households

(Table 8). The mean values of gamma for irrigation user households and irrigation non-

user households are 0.618 and 0.994 respectively. To compare, whether there exist

significant differences among these mean values, F distribution was found to be important.

The calculated F value was found to be 1.608 and compared with the critical values of F

tabulated (1.54). The result showed significant difference at 5 percent significance levels

with 63 and 58 degrees of freedom for the numerator and the denominator respectively.

Moreover, the value of the t ratio (14.991) observed for the estimated gamma of irrigation

non- user households was found to be highly significant at 1 percent significance level. In

contrast, the value of the t ratio (1.63) observed for the estimated gamma of the irrigation

user households was found to be significant at 10 percent significance levels. Further more,

the mean technical efficiencies of irrigation user households and irrigation non-user

households were 83 percent and 78 percent respectively. Hence, it can be observed from

the model output depicted in Table 8 that the use of irrigation has got significant impact on

the technical efficiency improvement of farming households. Moreover, there can be a

potential for efficiency improvement within irrigation user and irrigation non-user

households.

70
Table 9: OLS and ML estimation of the production function and inefficiency for
combined irrigation user and non-user households.

Variable Parameter Estimated value

OLS Estimates ML estimates
coefficient t ratio coefficient t ratio
Constant α0 3.356 6.310∗∗∗ 4.525 7.908∗∗∗
Ln land holding (ha) β1 0.395 3.664∗∗∗ 0.446 2.994∗∗
Ln labour (man-days) β2 0.113 1.186 -0.053 -0.507
Ln capital (value of input
in birr) β3 0.539 11.894∗∗∗ 0.505 10.205∗∗∗
Ln oxen-days β4 0.045 0.477 0.072 0.697
Inefficiency effects
Intercept δ0 -0.213 -0.440
Age of household head δ1 0.005 1.378
Land holding δ2 0.068 0.667
Distance from
development center δ3 -0.045 -1.861∗
Participation in extension
package program δ4 0.0381 0.440
Access to irrigation
technology δ5 0.326 2.53∗∗
Sigma square σ2 0.071 0.056 4.425∗∗∗
Gamma γ 0.294 0.740
Log-likelihood function -9.249 7.40
Mean efficiency 0.78
No of households 121 121
Note: Figures in parentheses are t ratios
∗, ∗∗, ∗∗∗
Indicate significant at 10%, 5%, and 1-% significant levels respectively

71
Table (9) shows the Maximum Likelihood Estimates of parameter of stochastic production

frontier. For the purpose of comparison, the OLS estimates of the parameters have also

been presented. Among the variables included in the production frontier, the parameter

estimates of landholding of the household and capital (includes, improved or local seed,

fertilizer and chemicals) were found to be significant. The result obtained is in conformity

with similar studies conducted by Abay and Assefa, (1996), Corppenstedt and Abbi,

(1996) and Getu et al, (1998). The other two variables, human labour and oxen power

were turned out to be insignificant. Given household landholding and cropping intensity of

the study area, the possible reasons for the parameters to be insignificant could be the

labour congestion, a situation in which larger amount of labour perform relatively lesser

amount of agricultural activity. It could also be because of the restrictive condition of the

Cobb-Douglas specification of the model.

The coefficients of the parameter estimates of capital, household landholding, oxen power

and human labour are 0.505, 0.446, 0.072 and -0.053 respectively. This indicates that there

is variability in relative importance of these inputs for agricultural productivity. In Cobb-

Douglas production function the parameter coefficients measure the elasticity of

production which, imply that keeping other variables constant, a one percent increase in

capital input shall lead to an increase of 0.505 percent in agricultural output. Given the

current prevailing conditions in the study area, the marginal productivity of capital,

keeping all other factors constant, is the highest followed by the size of household

landholding. These inputs are the most important inputs among the others. More

importantly, the bigger marginal productivity of capital with respect to agricultural output

reflects the greater need of capital by rural households.

72
With regards to efficiency measurement, the maximum likelihood estimates of Cobb-

Douglas stochastic frontier production function coefficients were used to predict the

technical efficiencies of individual farmers. At the outset, the specification of Eq(5) is

tested for the inclusion of the technical efficiency related variables ui by using a

generalized likelihood ratio (Coelli, 1998). If the random variable ui is absent from the

model, then the ordinary least squares estimates of the remaining parameters of Eq(5) are

maximum likelihood estimates. Therefore, the negative of twice the logarithm of the

generalized likelihood ratio has the approximately χ2 distribution with parameters equal to

7. The likelihood ratio (LR) was 33.306 and this value is compared with the tabulated χ2

values at degree of freedom of 7. The tabulated χ2 values at the degrees of of 7 and

significance level of 1% and 0.5% are 18.5 and 20.3 respectively. Hence, the estimated

likelihood ratio (LR) is greater than the critical χ2 values and significant. Therefore, the

null hypothesis that stated γ, δ0=δ1=δ2=δ3=δ4=δ5=0 is rejected and the alternative

hypothesis is accepted implying that there are farm specific inefficiencies in the production

system.

The signs of most of the estimates of the inefficiency parameters are as expected in a priori

hypothesis. However, the sign of the estimate of the distance between the farmers'

residence and development centers was found to be negative. This implies that the higher

the distance from development center the higher the efficiency of the farmer. Although

unusual, such result may be expected when extension agents do not have technologies to

offer or offer technologies for competing enterprise. Furthermore, the extension package

program underway was started before nine years and at the initial stage the participants

were farmers closest to the development centers. As the activity advanced, farmers in the

program started graduating after two years of participation in any one or more of the

73
components of the program. Then the new entrants would come in to the program and this

process continued from the center towards the periphery. Therefore, farmers towards the

periphery are those who have recently participated or are currently receiving new

technologies and technical advice and can be more efficient as compared to farmers

located close to the center.

Access to irrigation has a significant and positive influence on the improvement of

technical efficiency of farming households. In other words, having no access to irrigation

contributed to inefficiency of the farmer. Moreover, the estimated gamma value is very

low and insignificant indicating that the variability in production among household is much

affected by measurement error than the inefficiency effects (the value is indicated in Table

9).

The frequency distributions of technical efficiency of the individual sampled farmer in the

study area are presented in Table 12. The technical efficiency ranged from 70 to 96 percent

for irrigation users and from 53 to 86 percent for irrigation non-users. The mean technical

efficiency for the whole sample is 78 percent. In comparison with the findings of Abrar

(1995), Abay and Assefa (1996), Getu et al. (1998) and Mohammed et al. (2000), the

mean technical efficiency obtained in this study is much higher. The finding of the study is

in conformity with the finding of Temesgen (2003), which obtained the mean technical

efficiency of 77% for irrigated potato farms under modern irrigation schemes.

74
Table 10: Distribution of households by technical efficiency ranges

Technical Irrigation user households Non-user households

efficiency No Percent Cumulative No percent Cumulative

ranges percent percent

< 0.50

0.50-0.60 9 15.52 15.52

0.60-0.70 25 43.10 58.62

0.70-0.78 7 11.11 11.11 17 29.31 87.93

0.78-0.90 39 61.91 73.01 7 12.07 100.00

0.90-1.00 17 26.98 100.00

Total 63 100.00 58 100.00

As it is indicated in Table 10, 15.52 percent of irrigation non-user households have got

technical efficiency of less than 60 percent. Moreover, 88 percent of irrigation non-user

households perform at less than average technical efficiency level of 78 percent and only

12 percent of these households perform in the range of 78-86 percent technical efficiency.

None of the irrigation non-user households have got technical efficiency greater than 86

percent. Hence, for irrigation non-user households, there exist considerably high

inefficiencies (14 - 47 %) and technical efficiency deviations from the average technical

efficiency score and from the frontier in general. On the other hands, only 11 percent of

irrigation user households have got technical efficiency less than average and about 88

percent performed above the average technical efficiency level.

75
In general, 48 percent of sampled households (both irrigation user and non-user

households) have got an efficiency level of less than average, 38 percent of households

range between 78-90 percent efficiency and only 14.05 percent of households have got

efficiency between 90 and 96 percent.

The distribution of technical efficiency of the sample irrigation user and irrigation non-user

households is graphically indicated in Figure 2.

1.2
Technical efficiency scores

0.8
irrigation user
households
0.6
non-users
house holds
0.4

0.2

0
13
19
25
31
37
43
49
55
61
1
7

Households

Figure 2 Distribution of technical efficiency of irrigation user and irrigation non-user

households

76
 6. SUMMARY AND CONCLUSIONS

6.1 Summary

As in many developing countries, agriculture is the mainstay of the Ethiopian economy

employing about 85% of the population. However, the growth of the agricultural

production (both crop and livestock) is very low compared to the high population growth

rate.

About 97 percent of the country's crop production output are obtained from rain-fed and

subsistence peasant agriculture. Moreover, the country is known by recurrent drought and

up-hill food insecurity. Although, there is considerably high surface and ground water

potential, the ability to tap these potentials and make use of it has remained very

insignificant. Multiple cropping and other farming practices that can improve yield and

efficiency of the farmers are less prevalent. Hence, until recently, the strategy sought to

increase agricultural production was through area expansion, which ignored intensification,

and the use of proper management practices to increase efficiency of the farmer. However,

this strategy could not take the country far ahead as the total area suitable for crop

production is fixed or scarcer in relation to population growth and the scope of expansion

of arable land is limited. Therefore, seeking alternative solutions for these problems is

imperative.

Cognizant to this fact, the government has understood the important contribution of

irrigation to agricultural production and has devoted a large sum of budget for the

development of the sector. However, complementary to the effort of the government, the

empirical studies that substantiate or refute the theoretical hypothesis of the positive impact

of irrigation on technical efficiency and household income are lacking. This study

77
analyzed the impact of community managed irrigation on farm production efficiency and

household income in two purposively selected districts of Southwest Shewa Zone of

Oromiya National Regional State.

Southwest Shewa is one of the fourteen zones of Oromiya National Regional State. It has

10 districts and 308 peasant association with an area of 6398 square kilometers. The zone

is characterized by mixed crop-livestock farming.

A multi-stage random sampling procedure was employed for the selection of sample

respondents. In the first stage nine Kebeles, five from Woliso and four from Wonchi, were

randomly selected from sixteen and twelve Kebeles of the respective districts which were using

irrigation. In the second stage, the total households in the nine Kebeles were subdivided into

two strata of irrigation user and non-user households. The required data were collected through

interviews of farm household heads using structured questionnaire.

The survey data were analyzed using both descriptive analysis and econometric model with

the help of SPSS for window (version 10) for the estimation of the impact of irrigation on

household income and FRONTIER 4.1 for the estimation of technical efficiency

differentials.

The survey result revealed that the mean land holding of irrigation user and irrigation non-

user households is 2.16 and 1.5 ha respectively. The average number of oxen owned by

households was 2 with range 1-6 oxen. The mean TLU ownership status of irrigation user

and irrigation non-user households is 5.59 and 4.29 TLU respectively.

78
The result of econometric model indicated that household landholding, the amount of

credit received and household access to irrigation has got positive and significant

contributions to household income. This, in fact, is in support of a priori hypothesis and

other empirical findings (Quasim, 1994).

Estimation of the production frontier indicated that among the input variables included in

frontier function, the parameter estimates of household landholding and capital were found

to be significant. The Maximum Likelihood Estimates of Cobb-Douglas stochastic frontier

production function coefficients were used to predict the technical efficiencies of

individual farmers. The mean technical efficiency for the total sample is 78 percent. In

comparison with the findings of Abrar (1995), Abay and Assefa (1996), Getu et al. (1998)

and Mohammed et al. (2000), the mean technical efficiency obtained in this study is much

higher. However, it is in conformity with findings of Thiam et al. (2001). It was found that

irrigation user households had better annual income as compared to irrigation non-user

households. Having access to irrigation had significantly improved the technical efficiency

of farming households. Moreover, it was found that there is a room to increase production

and productivity of irrigation user and irrigation non-user households at the current levels

of resources utilization. Agricultural output can be increased on the average by 22 percent

if technical efficiency of farming households improved to obtain the maximum attainable

level of output.

6.2 conclusions

Based on the above findings of the study, the following implications or concluding remarks

can be drawn for further consideration and improvement of irrigation development in the

region in particular and in the country at large.

79
The study revealed that access to irrigation has got a significant and positive contribution

to income, implying that in a country like Ethiopia, irrigation development is crucial in

improving the livelihood of the population. It should, also, be noted that for proper

handling and management of the modern small-scale schemes continuous training and

technical assistance are extended and should be provided for the community. Specially, the

culture of multiple cropping, by far, is lacking in the area. The focus should not only be on

the physical achievement of the construction of irrigation schemes, but also on the

economic returns that the target community can generate from it and hence, extension

strategy that can make efficient use of the schemes should be developed and put in place.

The amount of credit received was found to significantly influence household income. This

could imply that households largely needed external financial sources to back-up their own

financial constraints to meeting production expenses. Hence, for sustainable increase in

agricultural output, farming households should get sufficient amount of money so that they

can purchase high yielding variety seeds, fertilizer and agro-chemicals. Therefore, to fill

this capital deficiency gap, the recently emerging rural financial institutions should be

encouraged and strengthen in terms of number and capacity to reach the needy households.

The frontier output, also, indicated that agricultural inputs have got significant influence on

agricultural output. More importantly, landholding of the household and capital were found

to be significant. Hence, for sustainable improvement in agricultural productivity, attention

should be given to changing the existing subsistence mode of agricultural production and

enhancing labour absorption outside agriculture.

80
This study indicated that there is a considerable potential for increasing the technical

efficiency of the farmers using the current levels of agricultural inputs and production

technology. Specifically the result suggests that at the given level of fixed and variable

inputs and farming practices, output could be increased by 22 percent if less efficient

farmers were pushed to the level of efficiency achieved by the best farmers. The results

clearly show that there are technical efficiency differences across households and,

consequently there is possibility to increase output without major increase in the inputs and

technological change. To bring about sustainable agricultural productivity, besides

supplying agricultural inputs, factors that influence the efficient use of these inputs should

be identified and considered.

The technical efficiency estimate of participation in the extension package program was

found to be insignificant. The result has deviated from our initial hypothesis and as well as

the government's expectation regarding the outcome of the program. This might be because

the extension package program currently underway is losing its momentum and (or) the

technologies the program comprises have exhausted. Hence, this result calls for the critical

evaluation and reformulation of the existing extension package program so as to improve

the productivity of agricultural input variables and ensure the attainment of food security in

the country.

However, it should also be noted that since the gamma value of the frontier output was

found to be insignificant, before giving concrete conclusions on inefficiency variables that

were included in the model of this particular study, further insight and investigation should

be conducted.

81
Furthermore, during the study some of the costs for irrigation development activities were

not available (was not possible to get) and hence, the impact of irrigation was considered

only form the point of view of households' gross income and efficiency improvement.

Therefore, further research that take into consideration costs and examine the profitability

aspect of irrigation development should be conducted.

82
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 APPENDICES

APPENDIX 1. Conversion Factors Used to Estimate Tropical Livestock Unit (TLU)

Types of Animals (spices) Indigenous Breed TLU Crosse breed TLU

Live weight (Kg) Live weight

Cow 250 1.0 380 1.5

Heifer 125 0.5 150 0.6

Oxen (Young bull) 250 1.0 300 1.2

Calves 50 0.2 50 0.2

Sheep and goat 22 0.1

Horse and Mule 200 0.8

Donkey 90 0.4

Source: Varvikko (1991)

APPENDIX 2 Conversion factor Used to estimate Person-days Equivalent (PE)

(agricultural labour force)
sex

Age group Male Female

< 10 0.00 0.00

10-13 0.20 0.20

14-16 0.50 0.40

17-50 1.00 0.80

>50 0.70 0.50

Source: Here (1986), John (1982), Ruthenberg (1983) and Nair (1985) cited in storck et al (1991)

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 APPENDIX 3 Coefficient correlation of variables of income determination
Access to Family Education Credit Livestock Farm Fertilizer

irrigation size received owned size used

Access to irrigation 1.000

Family size -0.04 1.000

Education -0.200 -0.007 1.000

Credit received -0.138 -0.106 0.077 1.000

Livestock owned 0.003 -0.232 -0.067 -0.165 1.000

Farm size -0.271 0.064 -0.160 -0.370 -0.326 1.000

Fertilizer used -0.133 0.061 -0.223 0.715 -0.160 0.680 1.000

APPENDIX 4 Correlation coefficients of the explanatory variables in Cobb-Douglas

production function frontier
variables Land Labour in Capital Oxen

man-days days

Land 1.00

Labour in man-days -0.287 1.00

Capital -0.237 0.032 1.00

Oxen days -0.259 -0.229 -0.057 1.00

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APPENDIX 5 Collinearity statistics of income and production frontier variables
Income variables Tolerance VIF

Family size 0.911 1.098

Farm size 0.541 1.850

Credit received 0.660 1.515

Education 0.872 1.146

Livestock ownership 0.682 1.466

Access to irrigation 0.751 1.322

Production frontier variables

Land 0.305 3.278

Labour in man-days 0.342 2.923

Capital 0.602 1.661

Oxen-days 0.420 2.380

As correlation coefficient alone not often reliable for the detection of multicollinearity

(Gujarati, 1999), we opted for VIF method to detect the presence of multicollinearity

between the explanatory variables.

Thus, before the specified model was estimated, the variance inflation factor (VIF)

technique was used to evaluate the degree of multicollinearity between explanatory

variables as it is indicated in equation (7). As a rule of thumb, if the VIF of a variable

exceeds 10 (this will happen if the Ri2 exceeds 0.90), that variable is said to be highly

collinear and it can be concluded that multicollinearity is a problem (Gujaratti, 1995).

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APPENDIX 6 Average annual Market prices of grain and bid prices of agricultural

inputs at district capital

Type of Product/input Price of product and input (in birr)

unit Wenchi (chittu market) Weliso (weliso market)

Teff qt 202.00 200.00

Wheat " 149.00 148.00

Barely " 136.00 142.00

Maize " 116.00 110.00

Sorghum " 120.00 120.00

Fieldpea " 190.00 192.00

Faba bean " 173.00 156.00

Chickpea " 175.00 180.00

Onion " 162.00 165.00

Potato " 65.00 67.00

Tomato Crates 10.00 10.00

DAP fertilizer(Average of qt 295.50 294.95

belg and main rainy season)

UREA fertilizer "

(Average of belg and main rainy 256.80 256.25

season)

Wheat seed(improved) qt 245.00 245.00

Maize seed (hybrid) " 578.00 578.00

Teff seed (improved) " 324.00 324.00

2-4D herbicide lts 48.00 48.00

Source: Zonal DPPD and ARD

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APPENDIX 7 List of rivers in the sampled kebeles used for irrigation and hectares of
land developed using irrigation

Sampled kebeles Names of rivers/spring Type of scheme Hectares of land

developed developed developed

Bedesa koricha 1. Ejersa river Traditional 165

2. Kel'a river Traditional 101

Fodu gora 1.Ejersa river Traditional 85

2. Rebu river Traditional 45

Gute Godeti 1. Walga river Modern 232

2. Kel'a river traditional 21

Chirecha 1. Dedebiya river Traditional 125

Chrecha Wonberi 1. Walga Traditional 150

Meti Walga 1. Walga river Modern 175

2. Berta spring Traditional 37

Dulele Kori 1. Berochu river Traditional 5

2. Lemi river Traditional 33

Haro Kono 1. Delena river Traditional 63

2. Ajo spring Traditional 4

Lemen Metahora 1. Amenya river Traditional 50

2. Gonjo river Traditional 8

3. Shano stream traditional 21

Source: Woliso and Wonchi DOID

94
APPENDIX 8 Physical and financial performances of small-scale irrigation
development in Oromiya.

Period year No of Irrigable No of Capital∗

schemes land (ha) beneficieries (Birr)

developed (HH)

Federal 2004 12 923 3040 14,268,800

Democratic 2003/04 22 2098 6668 27,133,610

Republic of 2002/03 3 364 710 3,297,710

Ethiopia 2001/02 14 1052 2228 11,366,735

2000/01 6 199 433 2,978,725

1999/00 5 375 1178 2,897,405

1998/99 6 417 901 4,532,800

Sub-total 68 5,428 15,158 66,475,785

TGE 1992-1997/98 79 6788 16909 46,073,087

Dergue 1984-1991/92 14 1122 3471 3,112,800∗∗

G. Total 161 13,338 35,538 115,661,672

Source: OIDA

∗ Capital includes both construction and design costs

∗∗ Information on the capital expenditure for some of the years could not be found. Hence, the figure should

be viewed with great care.

TGE represents Transitional Government of Ethiopia.

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APPENDIX 9 Individual efficiency scores of both irrigation user and non-user
households

Irrigation user households Irrigation non-user households

No Efficiency No Efficiency No Efficiency No Efficiency

scores scores scores scores

1 0.869 34 0.797 1 0.719 31 0.691

2 0.815 35 0.877 2 0.799 32 0.724
3 0.925 36 0.869 3 0.714 33 0.588
4 0.937 37 0.860 4 0.672 34 0.727
5 0.856 38 0.745 5 0.771 35 0.663
6 0.900 39 0.862 6 0.660 36 0.725
7 0.928 40 0.831 7 0.737 37 0.748
8 0.886 41 0.887 8 0.680 38 0.654
9 0.922 42 0.866 9 0.719 39 0.780
10 0.844 43 0.890 10 0.682 40 0.595
11 0.775 44 0.897 11 0.800 41 0.705
12 0.788 45 0.786 12 0.562 42 0.730
13 0.709 46 0.897 13 0.796 43 0.678
14 0.875 47 0.822 14 0.597 44 0.683
15 0.865 48 0.903 15 0.637 45 0.801
16 0.849 49 0.917 16 0.654 46 0.661
17 0.718 50 0.855 17 0.657 47 0.681
18 0.831 51 0.885 18 0.662 48 0.626
19 0.849 52 0.956 19 0.685 49 0.633
20 0.793 53 0.958 20 0.723 50 0.768
21 0.896 54 0.922 21 0.628 51 0.671
22 0.865 55 0.930 22 0.866 52 0.863
23 0.882 56 0.934 23 0.755 53 0.866
24 0.928 57 0.875 24 0.665 54 0.611
25 0.882 58 0.836 25 0.739 55 0.606
26 0.935 59 0.873 26 0.737 56 0.535
27 0.734 60 0.921 27 0.534 57 0.63
28 0.950 61 0.943 28 0.634 58 0.576
29 0.870 62 0.897 29 0.582
30 0.869 63 0.803 30 0.584
31 0.887
32 0.797
33 0.877

96
APPENDIX 10 Summary of Survey Questionnaire.

Alemaya University School of Graduate studies

Department of Agricultural Economics
Survey Questionnaire
For Msc thesis research, on Impact of Community managed irrigation on farm production
efficiency and household income: the cases of woliso and wonchi districts of oromiya
regional state.

Date______________
Woreda (district) __________ Kebele _____________
Village___________________

Respondent's name_______________________
(Farmer's)

Section 1:- Respondent's Socio-Economic Characteristics

1.1 Sex 1. Male 2. Female
1.2 Age __________ Years .
1.3 Ethnicity 1. Oromo 2. Amhara 3. Others(Specify)
____________
1.4 Religion 1. Muslim 2. Orthodox Christian 3. Protestants
4. Others (Specify)
1.5 Marital status 1. Married 2. Single 3. Divorced
4. Widowed 5. Others (Specify)
1.6 Can you read and write?
1. Yes 2. No
1.7 If yes, level of formal education in grade__________
1.8 Farming experiences; Number of years since started farming __________
years.
1.9 Do you have any other occupation in addition to farming

97
 1. Yes 2. No
1.10 Did you have some social position ( PA, Sc, Idir etc).
in the community so far? 1. Yes 2. No
1.11 If yes, what is your position and type of organization were you participated in?
(Type of organizations and position in the organization in the form of table in the original
questionnaire).

1.12 Type of your house

1. Grass roofed__________ 2. Corrugated iron roofed house __________
3. both_____________

2. Family characteristics: name of the family member, relationship, sex, age,

educational level and occupation of the family member (in table form in the
original questionnaire).

2.1 Number of Family members permanently working

i. Full-time on farm ________
ii. Part time on farm __________
2.3 Number of family members working
i. Full-time off-farm _______
ii. Part time off-farm __________

2.4 Do you face labor shortage?

1. Yes 2. No
2.5 If yes do you think it is a Major problem?
1. Yes 2. No
2.6 Time (month) of labor shortage ______________
2.7 For which kind of farming activities do you face labor shortage?
# if you face labor shortage in more than one activity, rank them as high, medium or low

1. Ploughing and seeding ( Food crops)

2. Weeding ( Food crops)
3. Harvesting (Food crops)
4. Ploughing and seeding horticultural crops
5.weeding horticultural crops

98
 6. Harvesting horticultural crops)
7. Herding
8. Soil conservation activities
9. Irrigating the farm or activities related to irrigation
10. Others (Specify) _____________________
2.8 If you face labor shortage how do you solve the problem of labor shortage?

1. Hiring 2. Labor exchange (wonfel). 3. Debo

4. Others (Specify)

2.9 if you hire labor on farm during which crop production season you hire labor? In table
form: (Crop types in the first column and type of activities such as, ploughing,
planting, weeding, irrigating, guarding, harvesting, threshing, transporting and etc. in
the first row of the rest of columns.
2.10 Amount of labor in man/days actually utilized for the following crop production
activities in the year 1995/96. In Table form in the original questionnaire ( crop
production and marketing activities in vertical plane and types of crops grown in
horizontal plane
2.11 Amount of oxen power in oxen/days actually utilized for the following crop
production activities in the year 1995/96. In table form in the original questionnaire (
crop production activities in vertical plane and type of crops grown in horizontal axis).
2.12 Family labor utilization or allocation in the year by month in table form in the
original questionnaire. ( Months, number of days allocated for agricultural activities, social
purposes, ritual purposes, petty trade, marketing the produce and others)

3. Land holding and utilization

3.1 indicate the amount of land you have by source
1. PA given land__________ Timad/Kert
2. Inherited from parent____________ Timad/Kert
3. Parent given land _______________Timad/Kert
4. Rented in land__________________Timad/Kert total cost
________Birr
5. Taken for share cropping __________ Timad/Kert

99
 6. Other(specity)________________ Timad/Kert

3.2 If you rent out land, why?______________________.

3.3 How much is the rent of Timad/Kert of land in birr for an annum?
1. Irrigable land __________ 2. Non-irrigable land

3.4 Agricultural production and household income

Land use, crop production and utilization during the year 1995/96
Type of crop Area under the Out put under Total Amount Amoun
Soci t sold
or activity specified activity the activity output consumed al remar
at home cont k
Rain Irrigated Rain Irrigated
ribut
fed fed (qt) ion
in
kind

3.4 is there grain you purchased for consumption during the production year?
1. yes 2. No
3.5 If yes to 3.4 What was the quantity_______ and its value in birr________
3.6 Did you receive food aid from government, private or donor agencies in the year
1995/96?
1. Yes 2 No
3.7 if yes to 3.6, What was the amount in qts _______ and its value in birr______

3.8 Livestock production status during 1995/96 production year

Type of No of animal at the Sold during the year Bought during the year
beginning of the year
livestock Number Value in birr Number Value in birr

3.9 incomes from livestock product during the year 1995/96

No Items Value in birr
3.9 do you or your family under take some additional income generating activities of off
farming in the year 1995/96?
1. Yes 2. No
3.10 if yes to question 3.10, state the income earned during the same year (1995/96) from
off farm activities

100
 source off income amount in birr
- hand crafts __________
- casual labour __________
- local beverage __________
- selling fire wood __________
- petty trade ___________
- Remittance ____________
_ others (specify) ____________

3.11 Agricultural input utilization in the year 1995/96 on rain fed farms
Type of crop Fertilizer Seed/tuber Herbicide Pesticide
used in liter in lt/kg
Dap Urea Impr Local
(kg) (kg) oved (kg)
(kg)

3.12 Agricultural input utilization in the year 1995/96 on irrigated farms

Type of crop Fertilizer used Seed/tuber Herbicide Pesticide
Dap Urea Impro Local (lt) (lt/kg)
(kg) (kg) ved (kg)
(kg)

3.13 Do you use agricultural inputs as per the recommended rate? 1. Yes 2. No
3. 14 if No to question 3.13 what are the possible reasons for not using it?
1. Unable to purchase
2. No credit facilities
3. Do not know its importance
4. Not available in the area
5. No fertility or productivity problem
6. Other specify
3.15 if you use fertilizer or improved seed how did you obtain it?
1. Purchase from Agricultural bureau
2. Purchase from local market

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 3. Obtain on credit from Agricultural bureau
4. Purchase in the village /from relatives
3.16 What is the price of hundred kg of Dap________ urea________.
3.17 What is the price of hundred kg of improved seed varieties?
1. Wheat_______________ 4. Onion__________
2. Maize_________________5. Potato____________
3. Barely________________ 6. Tomato____________
3.18 How do you perceive about the price of the inputs? 1. Cheap 2. Fair 3. Expensive

4. crop production and irrigation development

4.1 if you use irrigation for how long have you been using?________years
4.2 If you were using irrigation how do you perceive the income you have
generated from it?
1. Low 2. Medium 3. High

4.3 if you are not using irrigation what are the reasons for not using?
1. have no farm land in irrigation area
2. not aware of it
3. sufficient rain and moisture
4. others specify__________________
4.4 If you are using irrigation how do you perceive the size of land holding you
have under irrigation?
1. very small
2. small
3. sufficient
4. big/ large

4.5 What is the source of water for irrigation? 1. Rivers 2. Springs 3. Ponds 4.
Wells 5. Others specify
4.6 What is the number of watering that you think is sufficient for plant growth
and good yield?

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No Type of crop Number of watering Actual number of Scarcity
required watering
performed
in(1995/96)

4.7 what is the location of your farm from the source of water for irrigation? 1.
Among 25% farms towards the source( head) 2. Among 50% of farms towards
the head 3. Among 50% of farms to the tail 4. Among 25% of farms to the tail
4.8 what is the system of water allocation? 1. proportional to the amount of land
you have under irrigation 2. Equal division among members of the association
3. specify if any other system
4.9 which one of the above systems do you want to happen? 1., 2., 3.
4.10 In times of scarcity, do irrigators steal water? 1. Yes 2. No
4.11 If yes to question 4.12, can you tell what types of irrigators steal water? 1.
Users near the head 2. Users far from the head/ command area 3. Influential
people 4. Women users
4.12 What measures are taken against water theft?_____________
4.13 What kinds of structures are developed on the water sources? 1. Earth dams
2. Concrete dams 3. Diversion weirs 4. Canals 5. Others, specify
4.14 What is the distance in kms between the source of water for irrigation and
your farm?
4.15 If the responsible body for managing irrigation scheme is the community,
describe in detail how it is organized
4.16 Is any priority given to a particular group to use the irrigation? 1. Yes 2.
No
4.17 If yes to question 4.18, to which particular group(s) it is
given?_______________
4.18 Is water user association organized in the area? 1. Yes 2. No
4.19 Are you the member of water user association? 1. Yes 2. No
4.20 Are there any criteria to be a member of water users association? 1. Yes 2.
No
4.21 If yes to question 4.22 indicate the criteria_______________

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4.22 What other benefits do you get from water users association apart from
supply of water? Describe in details____________
4.23 List down, as much as possible, the major tasks or objectives of water users
association__________________________.
4.24 As a member of water users association what is your contribution for the
sustenance of the scheme? 1. Cost sharing for scheme/ canal maintenance 2.
Labour contribution for scheme/ canal maintenance 3. Contribution for the
salaries of water master 4. Others
4.25 If you are contributing for cost sharing and/or labour contribution, which of
the following types do you use? 1. Proportional to the amount of land you
have under irrigation 2. Equal division of the amount required among
members 3. Other systems, if any
4.26 If you contributed labour in the last cropping season, how many man/days
of labour you have contributed?___________
4.27 If you contributed in terms of money how much did you contributed in the
year 1995/96 ?_________________
4.28 If any member of water users association failed to contribute the required
amount of labour or money, what measures are taken by the
association?___________________________
4.29 Did you used to pay a fee against the water you have used for irrigation 1.
Yes 2. No
4.30 If yes to question 4.31 how much did you pay per timad/kert of land? ____
4.31 If No to question 4.31 why not?
4.32 What is your view about fees for irrigation in the future?
4.33 Which types of crop you like to grow under irrigation?. Arrange them in
order of importance_________________________________________
4.34 Why you like them most? 1. High yield per ha. 2. High market value/
demand 3. Have improved variety of seeds 4.Requires less ware demand
5. Requires less labour demand 6. Easy to handle the produce 7. Others,
specify
4.35 Do you practice multiple cropping? 1. Yes 2. No
4.36 If no to question 4.37, why not? Specify ____________
4.37 If yes to question 4.37, how often/ how many in a year you grow crops on
the same field? 1. Twice 2. three times and more

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 4.38 On which part of your landholding you practice cropping twice or more
than twice a year? 1. Irrigated 2. Non irrigated or rain fed 3. Both
5. Marketing services
5.1 How do you sell your produce from irrigation in gewneral? 1.Sell on the farm 2.
Harvest and sell at the market 3. Use both methods 4. Others specify

5.2 where do you sell the produce harvested from irrigated field? 1. At farm gate
2. At village market ( farm boundary) 3. At district market (local market) 4.
At regional market 5. At national market
5.3 What is the average distance of your farm (irrigation) from district market?
5.4 What is the means of transportation of the produce to the market? 1. human
labour 2. pack animals 3. carts 4. vehicles 5. Others
5.5 Method of acquiring the means of transportation 1. own 2. renting or hiring
3. Other means if any
5.6 If you hire or rent the means of transportation, what is the cost to transport
100kg of produce from farm gate to district (local)
market?________birr/quintals
5.7 did you get reasonable price for your produce at the place you used to sell to?
1. Yes 2. No
5.8 If no to question 5.7, for which type of produce the problem is very
serious?_________________
6.9 What do you think are the possible cause of the problem ( for low or
unattractive price)? 1. Surplus production (high No of producers) 2. Low
demand for the produce 3. High cost of production (high cost of input) 4.
Seasonality of the product 5. others specify
5.10 to whom you sell your produce most of the time? 1. Consumers 2. Retailers
3. Cooperative 4. Country assemblers or wholesalers 5. Processing
industries 6. others specify
6. Institutional Support
6.1 Do you get market information about prices and demand conditions of
agricultural inputs and out puts? 1. Yes 2. No
6.2 If yes indicate the source of information_____________________
6.3 Do you have radio? 1. Yes 2. No
6.4 Do you listen to agricultural programs on radio? 1. Yes 2. No

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 6.5 Do you know the existence of irrigation extension services in your area? 1.
yes 2. No
6.6 Is there any government, private, non-governmental organization working on
irrigation development in your area? 1. Yes 2. No
6.7 If yes can you mention some of its activities and contributions working on
irrigation development in the area?
6.8 Have you been supported by any of these organizations to improve your
irrigation activities? 1.Yes 2. No
6.9 If yes specify some of the supports you got so far.___________________
6.10 Did you participate in extension Package activities? 1. Yes 2. No
6.11 If yes specify type of packages and year you started participating______
No Type of package Year you participated

6.12 Is there a research (Agricultural Development Agent) in your area? 1. Yes

2. No
6.13 If yes to question 6.12 do you get services or technical advice from
development agents? 1. Yes 2. No
6.14 If yes to question 6.13 how many times the development agent has visited
your farm in the year 1995/96 and given you technical supports?________
6.15 How many times in the year 1995/96 you have visited the development
agents office and seek advice?______________
6.16 What is the distance in Km. from your home to the development agent's
office or residence?
6.17 How many hours it requires you to walk from your home to the
development agent's office or residence?
6.18 Do you think the technical supports you got from development agents are
sufficient, up to date and helped you in developing you agricultural
knowledge? 1. Yes 2. No
6.19 If no to question 6.18, indicate some areas of
deficiency___________________________________
6.20 Apart from the existing traditional agricultural implements do you own in
group or on individual basis some improved or modern agricultural
equipment? 1. Yes 2. No

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 6.21 If yes to question 6.20 what are these equipment 1. Tractor 2. Trailer 3.
Carts 4. Modern beehives 5. Motor pumps 6. Seed treats 7. Maize Sheller 8.
Harvesters and threshers 9. Others specify
7. General opinion
7.1 Please mention all problems associated with irrigation development activities in your
area____________________________________
7.2 Describe any social economic and environmental problems you have in the area
7.3 Give your view as to what interventions must be made for better implementation of
modern irrigation technologies______________________
7.4 Give your idea with regards to any negative impacts and constraints of
irrigation_______________________

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