1. The Role of Potato Seed Cooperative in Improving the Livelihood of Rural Households: The Case of East Harerghe, Ethiopia
Wegayehu F. & Belaineh L.
54 th Annual Conference
Of the AEASA
September, 2016

2. Introduction Agriculture in Ethiopia:-
- the foundation of the country's economy
- accounting over 38.8% of GDP
- 83.9% of exports and
- 80% of total employment
Generation and transfer of new technologies are important for agricultural development and transformation
Seed- one of the most important inputs and a key catalyst in agricultural transformation
- without seed there is no next season crop
- improved varieties is an essential for increasing crop prod.

3. Seed production systems
There are different seed production systems in Ethiopia:
- Informal seed systems (80-90%) by smallholder farmer
- community-based seed system
- commercial seed system
- formal seed systems
breeding, releasing and production of different seeds
Cooperative unions, private sectors, NGOs and other org.
multiplication and distribution of certified seed
There is a gap between demand and supply

4. Cooperatives
In Ethiopia cooperatives are playing a crucial role in attaining food security through:-
- agricultural input and output marketing facilitating irrigation for crop production
- value addition, creation of employment
- establishment of small and micro enterprises
Seed producer cooperatives- increase yield and income of members by pooling their resource
-collective services and economic empowerment

5. Integrated Seed Sector Development (ISSD)
ISSD was launched in 2009 to improve the seed shortage in Ethiopia, in four regions and different crops
- the first phase was implemented from 2009 to 2011,
with 34 Seed Producing Cooperatives (SPCs)
- phase II program was started in January 2012
- East Harerghe - 3 SPCs
no study has been conducted to assess the impact of potato seed production by involved cooperatives
this paper provide empirical evidences on impacts of seed production on the livelihoods of the households in the respective study areas using counterfactual data

6. Research methodology The study was conducted in two districts (2013):
- Haramaya (508 km from Addis Ababa)
- Kersa (483 km from Addis Ababa)
-Tinike and Ifa Jalela
Sources and Methods of Data Collection
Primary data had generated from (172 hhs) through:
- household survey (face to face interview)
- group discussions
Secondary data were collected from published and unpublished sources

7. Methods of Data Analysis
both descriptive and econometric statistical tools
- Propensity Score Matching (PSM)
The dependent variable is dichotomous taking two values, 1 for seed potato cooperative member 0, otherwise
The mathematical formulation of logit, Gujarat (2004) Pi =
Pi =
Where, Pi is the probability of participation for the ith hh
Zi: is a function of n-explanatory variables which is expressed
Zi = B ∑Bi Xi + Ui

8. Descriptive results of continuous variables
Haramaya district
Kersa district
Members
(N=41)
Non-Members
t-value
Members (N=45)
Non-Members (N=45)
Mean
STD
FMS
7.09
1.97
6.29
2.88
-1.48
6.07
2.21
5.64
1.89
-0.97
TLH
1.22
0.69
0.75
0.85
1.09
1.13
0.54
0.48
TLU
4.69
1.93
1.67
2.81
2.53
2.13
1.78
-1.47
EXPR
8.34
5.25
3.88
4.28
7.04
2.99
1.58
1.98
IRREQ
9760
6309
2848
5174
3734
6057
564
1906
-2.70***
-2.98***
-6.95***
-4.22***
-10.22***
-5.42***
-3.34***

9. Descriptive results of dummy variables
Category
Haramaya district
Kersa district
Members
(N=41)
Non-members (N=41) 2
Members (N=45)
Non-members (N=45) N %
SEX
Male 36
87.8 35
85.4
0.105 42
93.33 40
88.89
0.46
Female 5
12.2 6
14.6 3
6.67
11.11
EDU
Literate 29
70.7 19
46.3
5.025** 16
35.56
1.00
Illiterate 12
29.3 22
53.7
64.44
SOCN
Available 33
80.5 11
26.8
23.74*** 31
68.9 9
20.0
21.78***
Non- available 8
19.5 30
73.2 14
31.11
80.00
EXPEC
Increase 38
92.7
0.52 45
100.0 24
53.3
1.25
Decrease
0.0 13
28.9
No change
7.3 2
4.9
17.8

10. Variables determined participation Variables determine participation
Notes: *, ** and *** denote p < 0.1, p < 0.05 and p < 0.01
Variable
Coefficients
Std. Err.
Z- value
dy/dx
SEX
1.195
0.776
1.54
0.274
EDU
0.058
0.522
0.11
0.014
FAMS
-0.007
0.119
-0.06
-0.002
EXPR
0.369
0.082
0.092
TLU
0.299
0.146
0.075
TLH
1.148
0.414
0.287
SOCN
2.634
0.582
0.577
EXPEC
0.747
0.624
1.19
0.186
IRREQ
0.001
0.000
District
-2.704
0.705
-0.589
_cons
-4.053
1.271
-3.19
-0.832
Number of obs
172
LR chi2(13)
133.25
Prob > chi2
Log likelihood
Pseudo R2
0.5588
4.49***
2.05**
2.77***
4.52***
3.14***
-3.83***

11. Steps to estimate ATT 1. Estimation of PSM- logit
2. Matching - the common support region- mapped using
propensity score distribution
3. Choice of matching algorithm
- balancing test
- pseudo R2
- sample size
Nearest neighbor with replacement NN(4) is the best estimator
4. Testing the balance of propensity score and covariates
- standardized bias before and after matching
- pseudo-R2
- two sample t-test

12. Balancing test of covariates

13. ATT estimation
all ATTs for significant outcome variables were insensitive to unobservable biash
members have gained greater:- annual income by Birr 33,901
- income from crop production by Birr 29,006
- total expenditure by Birr 11,728 and
- total asset of Birr 47,768 than non- members
Outcome variables
(Birr)
Treated
Control
Different
S.E
t-value
INCCR
51495
22489
29006
11608
2.50***
INCLV
26678
25151
1527
4277
0.36
ANINC
84741
50839
33901
13653
2.48***
TEXPEN
39585
27856
11728
4498
2.61***
TASSET
106257
58488
47768
22004
2.17**

14. Sensitivity analysis
PSM tries to compare the difference between the outcome variables of participants with non-participants with similar observed characteristics
If there are unobserved variables that simultaneously affect the participation decision and the outcome variables
- might arise and the PSM estimator may no longer be consistent
Sensitivity analysis involves calculating upper and lower bounds with a Wilcoxon sign-rank test to test
all ATTs for significant outcome variables were insensitive to unobservable bias

15. Conclusion
The logit model estimates the determinants of household’s participation in potato seed producing cooperatives.
- influenced by: EXPR, TLH, TLU, SOCN, IRREQ and District
A positive and statistically significant impact on the livelihood indicators of members households
In addition to member households, non-member households also benefited from seed producing cooperatives
- member households share their experiences
- access of quality seed with fair price

16. Recommendations
A positive and statistically significant impact of seed potato producing cooperative
government and other NGO like ISSD should provide support to expand seed potato producing cooperative
increasing income and improving food security in the study area and the country as a whole
The contribution of irrigated crop like potato would have positive impact on asset value, income and food security of member
The MoA and other concerned bodies should give attention
expansion of small scale irrigation through protecting wetland loss
harvesting water by using different mechanisms.

17. Thank You