TITLE:
The Role of Avocado Production and Trade in Major Producing Districts, Tanzania: Income Inequality Decomposition Approach
AUTHORS:
John Boniphace, Reuben M. J. Kadigi, Joseph Rajabu Kangile
KEYWORDS:
Avocado, Tanzania, Exportation Trade, Income Inequality, Gini Decomposition, Cofficient of Variation
JOURNAL NAME:
Modern Economy,
Vol.14 No.11,
November
29,
2023
ABSTRACT: This paper investigates whether the production of avocado for the export
trade is an income inequality decreasing source of livelihood of producers in
Tanzania or not using the evidence from the Hai and Rungwe districts. Data were
collected using a semi-structured questionnaire from avocado producers in the
study areas. The Gini decomposition technique was employed to analyse the
nature and source of income inequality amongst the avocado producers in the
study areas. The results of the analysis showed that, on average 34% of the
total household income was derived from production of avocados for export. The
Gini decomposition analysis revealed an income inequality index of 0.748 for
the pooled sample. The Gini index for avocado production was 0.537. The study
also showed that avocado production for export trade was the increasing source
of income inequality in the study areas with a relative concentration of 0.794
and 0.9944 in gini decomposition and coefficient of variation respectively. Gini
decomposition and coefficient of variation reveal salary to be the most
inequality-increasing source of income in the study areas. The
production of avocados for exportation provides not only additional income but
also improves the living standards of smallholder farmers, and it narrows their
income gaps. We recommend the promotion and scaling up of the production of
avocados as one of the key economic activities that would help tackle the
problem of income inequality in rural areas suitable for the production of Hass
avocadoes for export in the country.