Hunger Project credit facility and maize productivity in Ghana

Abstract

This paper evaluated the effect of credit facility on the productivity of participants of the Hunger Project in Ghana. Primary data was collected from randomly sampled 170 beneficiary and non-beneficiary smallholder maize farmers of the project in the Kwahu West Municipality. Descriptive statistics and the endogenous switching regression model were used to analyse the data. The results showed that gender, number of livestock owned by the farmer, previous year's maize income, farmers' perception of lending procedures of the Project and farmers' perception of the distance between residence and the epicenter (loan center) were the factors influencing farmers' decision to take part in the Hunger Project credit programme. The study also revealed that farmers who benefited from the programme had a significant increase in maize output: thus, the credit facility significantly influenced farm productivity. In addition to maize farming, farmers should be encouraged to keep livestock, and the project management should open loan centres close to the farmers to improve access to loan by the farmers, particularly current nonbeneficiaries, to improve their productivity. This should be supported by an extension of education and training. Contribution/ OriginalityFarmers' participation in agricultural credit programme such as the Hunger Project is essential for its impact evaluation. The study found that agriculture credit programme specific factors significantly influence small scale maize farmers' participation decision. Also, the increase in the productivity of participants resolves credit-productivity puzzle.