The response of farm labor and farm production to animal grazing and water resource scarcity in Northern Ethiopia

Purpose. Rural households spend a large share of their daily time to search for grazing feed, water resource and collect straw by displacing labor time away from crop farming activities. This paper aims to analyze the economic effect of time spent looking for animal water and grazing areas on farm labor input and crop farm output. Methodology / approach. To address our objectives, a general Cobb-Douglas production function was estimated using a unique dataset from 518 sample farmers in Tigrai, Ethiopia drawing on a non-separable farm household model. Results. The results favor the hypothesis of a negative relationship between crop output and resource scarcity. In aggregate, the findings confirm that reducing time spent looking for water, grazing and straw by 1 % leads to an increase in food production by 0.155 %, 0.279 % and 0.328 % respectively. Similarly, the shadow price variables are significant, have the expected negative sign and are consistent with the theory. The sign of other factors are consistent with the prediction of the economic theory. Originality / scientific novelty. The noble contribution of this paper is, unlike previous studies, we collected information on the entire set of crop production, along with the distance to grazing, water and crop residue of each household. This paper considers three important resources for an animal such as grazing, water and crop residue, of which the first two have not been explored well. The use of distance level and shadow price as resource scarcity indicators is an extra benefit to the literature. Practical value / implications. The results of this paper provide an interesting picture of stallholders in Ethiopia. As expected, it appears that time spent searching for animal water and feed has a significant and negative effect on labor and crop output. Our results got the evidence of a negative relationship between labor input to crop farming and resource scarcity