Eighth International Conference on Food Studies

Abstract

Fertilizer subsidy is important policy in developing countries like Ghana where the use of fertilizer is low despite declining soil fertility. The study evaluated the impact of subsidy on productivity and technical efficiency in Ghana’s cocoa industry by using 400 cocoa farmers from two cocoa districts in Ghana. Stochastic Frontier and Propensity Score Matching techniques were employed to achieve the study objective. The impact pattern of the fertilizer subsidy programme in Ghana was found to be largely conditioned by farmer location. Whereas the policy had a significant positive impact on cocoa productivity in the Western Region, it did not have any significant impact on productivity in the Ashanti Region of Ghana. Conversely, a negative impact of the policy on technical efficiency was observed in the Ashanti Region, with no significant effect on same in the Western Region, ceteris paribus. Location-specific implementation challenges might account for these mixed policy outcomes. Therefore, the study recommended specific steps that Ghana COCOBOD should take to address the implementation challenges associated with the policy in different cocoa growing to ensure that policy objectives of increased productivity and production efficiency are achieved.