Economies of Scale, Capacity Utilisation and Productivity Measurement in Zimbabwean Commercial Agriculture

• Published in: African development review 1997-12, Vol.9 (2), p.15-32
• Main Authors: Mlambo, Kupukile, Zitsanza, Nancy
• Format: Article
• Language: English
• Subjects: Agriculture; Economies of scale; Measures; Productivity; Zimbabwe
• ISSN: 1017-6772; 1467-8268
• DOI: 10.1111/j.1467-8268.1997.tb00153.x

: Agriculture plays an important role in the development of the Zimbabwean economy, impacting on overall economic growth, household incomes and food security. However, its poor performance in recent times has raised serious questions about its viability, and the implications this has on self‐sufficiency and food security. While current debates on the problems facing the agricultural sector have tended to focus on poor incentives and excessive government intervention as major constrains, in this paper we argue that attention should also be paid to other non‐price factors such as technological constraints, and inadequate physical and social infrastructure. We specifically focus on the former, arguing that a successful transformation of the agricultural sector to a dynamic and efficient producer of output is partly dependent on appropriate technological advance. This is because as land becomes less available, growth in agricultural output, especially in the commercial farm sub‐sector will increasingly depend on technology generating activities such as investment in research and development, extension services, and foreign technology. We use a production theory framework to document improvements in the performance of total factor productivity (TFT) growth in Zimbabwe's commercial agricultural sector and draw conclusions for technology‐improving policies. The study finds that between 1970 and 1990, the commercial agricultural sector in recorded a 3.4% increase in total factor productivity, slightly higher than that suggested by earlier studies using the traditional growth accounting framework. We also decomposed TFP growth into three components, viz the technical change effect, the capacity utilisation effect, and economies of scale effect. The results show that the technical change effect dominates TFP growth, followed by the capacity utilisation effect, while the scale effect has a negative impact? Résumé: L'agriculture joue un rôle important dans le développement de l'économie zimbabwéenne, que ce soit en termes d'impact sur la croissance économique globale, de revenus des ménages ou de sécurite alimentaire. Cependant, les contre‐performances de ces derniers temps font douter de sa viabilité et, partant, de son aptitude à garantir 1'autosuffisance et la sécurité alimentaires. Le débat en cours sur les problèmes du secteur agricole se concentre généralement sur deux contraintes majeures: la modicité des incitations et un interventionnisme d'Etat excessif. Tou