How efficient are African smallholders? A case study in the Eastern Cape province of South Africa

Abstract

One of the aims of the South African government is to create higher income opportunities for the previously disadvantaged black community. In agriculture, this would involve re-establishing and supporting diverse forms of successful black agriculture. The main objective of this paper is to debate the issue of opportunity cost assumptions in the calculation of comparative advantage indicators for smallholders. This study reveals that these farmers can produce efficiently , even when subjected to opportunity cost assumptions that apply to their traditionally white commercial counterparts. Given additional prospects for strong linkages with the rest of the rural economy, speedy implementation of public investment programmes is warranted so as to level the playing field in the agricultural and rural economy.