Abstract:
Ethiopia has substantial potential in honey production with rich flora, funa and existence of
large bee colonies. However, honey production in the country is characterized by low
efficiency so that its economic contribution is not commensurable to its potential. This study
analyzed economic efficiency of honey production among sampled farmers of 260 (130
traditional and 130 modern) of honey producers from Seyo Nole district, Ethiopia. Multi stage sampling technique was used to select representative sample households. Descriptive
statistics and econometric models were used to analyze the collected data. Stochastic
production frontier model with Cobb- Douglass type production functional form was used to
estimate the level of efficiencies. The result of the model indicated that input variables such as
beehive and human labor have positive and significant effect on honey output at different
significance levels in honey production using traditional hives. Reserved land, beehive and
supplemental feed were positively and significantly affected honey production using modern
hive. The coefficient of Cobb-Douglas type production function are interpreted as elasticity
and summing the individual elasticity yields a scale elasticity of 0.92 and 0.46 for traditional
and modern production, respectively. This indicated that farmers facing decreasing returns to
scale. The mean technical efficiency (TE), allocative efficiency (AE) and economic economic
Efficiency (EE) of farmers who use traditional hive were 65%, 60% and 38%, respectively.
The figures were 74%, 66% and 49%, for modern hive, respectively. The Tobit results
indicated that sex, agroecology and hive shading positively and significantly influenced the
TE and EE of traditionally honey producing farmers, while education level was negatively
related to the efficiencies. Family size, agroecology and off-farm income were significantly
affected AE of honey producers with traditional hive. Whereas, sex, education, family size,
income, extension contact and training positively influenced the TE of modern producer.The
results of this study show that there is an opportunity to increase the efficiency of honey
production in the study area by giving special attention to the identified determinant factors.
