Estimating the Effect of Technological, Institutional, and Input Cost Drivers on Maize (Zea Mays) Productivity in Songea District, Tanzania: An Endogeneity Controlled Analysis

Abstract

Maize is a staple crop in the region, and its productivity plays a vital role in ensuring food security and improving the livelihoods of smallholder farmers. Despite the potential for high yields, smallholder farmers face challenges in optimizing production due to factors such as limited access to modern farming technologies, insufficient institutional support, and high input costs. This study estimate the effect of technological factors, institutional factors, and production costs on maize productivity among smallholder farmers in Songea District, Tanzania. The study uses a cross-sectional design with questionnaire to collect data from 397 smallholder maize farmers. To address potential endogeneity the study employs an instrumental variable Two-Stage Least Squares (IV-2SLS) estimation. The results reveal that land size (p < 0.05) and credit access (p < 0.01) significantly increase productivity. Technological factors, including improved seed adoption, inorganic fertilizer use, integrated pest management, and tractor use (p < 0.01), also have strong positive effects on maize output per worker. Similarly, institutional and socio-economic factors such as market access, training attendance, number of hired labor, household size, income, and favorable rainfall conditions (p < 0.01) significantly improve maize productivity. In contrast, higher input costs, including fertilizer costs, pesticide costs, and seed costs (p < 0.01), significantly reduce productivity. Elasticity estimates from the Cobb–Douglas IV model show that fertilizer use (0.499), land size (0.853), and labor (0.042) positively contribute to maize output. Hypothesis testing confirms diminishing marginal productivity of fertilizer and labor, while land size exhibits constant marginal productivity. The combined elasticity of core inputs suggests that maize production operates under constant returns to scale. Thus, strengthening access to agricultural inputs, credit services, extension programs, and market infrastructure can significantly improve maize productivity and contribute to food security and rural income growth in Tanzania.