Agrifood system participation and production efficiency among smallholder vegetable farmers in Northern Ghana

Formalized marketing arrangements between smallholder farmers and produce buyers are gradually replacing spot market transactions in developing countries due to the rapid structural transformation of agrifood systems. This study examines the impact of agrifood system participation on the total value of vegetable production and technical efficiency (TE), using a sample of 423 vegetable farmers from Northern Ghana. We employ propensity score matching and W. Greene's selection bias-corrected stochastic production frontier methods to correct for observable and unobservable selection bias issues, respectively. We further use a metafrontier model to derive technology gap ratios (TGRs) and meta-TE for agrifood system participants and nonparticipants. The results reveal that agrifood system participants are about 50% more productive than nonparticipants. In addition, participants have higher meta-TE (58% vs. 55%) and TGR (98% vs. 94%) than nonparticipants. Variables such as farmer group membership, extension visits, mobile phone ownership, irrigation and road access are the notable correlates of smallholder farmers' participation in agrifood systems. The total value of vegetable production is significantly influenced by fertilizer, agrochemicals, seeds, irrigation, soil fertility, and location-fixed effects. [EconLit Citations: D24, Q12, Q18]