The purpose of this study is to explore reasons for the decline in agricultural performance in Botswana that has occurred during the implementation of a variety of policy measures, as well as the introduction of new technologies, and to identify ways in which it might be reversed. Panel data from six regions in Botswana (period 1979-2012) is analyzed with a stochastic output distance function and inefficiency effects model. We decompose agricultural output growth into; total factor productivity (TFP) and changes in input use (factors of production). TFP is further decomposed into scale effects, technical efficiency and technological change. The results show that over the study period agricultural output grew at a very low rate of 0.072 percent per year, which is largely due to a growth in factors of production at 0.071 percent per year rather than TFP growth (which declined at 0.003 percent per year). We found that the decline in productivity has been due to technological regress and low growth in technical efficiency and scale efficiency. Policy options aimed at improving agricultural productivity and output growth will require the strengthening of extension services; improving the agronomic and husbandry management skills of farmers through training; and by encouraging farmers to adopt and utilize technologies that have been provided under existing policy programs.

To improve the welfare of the rural poor and to decrease the dependence of the national economy on minerals, the government of Botswana has been spending 40% of the value of agricultural GDP on agricultural support services. Despite this massive investment, there is evidence that agricultural productivity has declined in recent years. This paper attempts to explore the reasons for this decline. We use secondary data from six regions of Botswana (covering the period 1979 to 2012) to construct a Fare-Primont index of productivity following the approach proposed by O'Donnell (2012). The results of the analysis show that annual TFP has gradually declined over the period. This decline is predominantly due to technological regress which is offset by some increase in scale and mix efficiency.

Agriculture plays an important role in Botswana, providing food, income, employment and investment opportunities for the majority of the rural population. However, over the last two decades, the contribution of agriculture to the economy and rural development has declined leading to a progressive increase in food imports. Low growth in the agricultural sector has been attributed to low productivity, which could be attributed to the recurring drought conditions that prevail in many parts of the country, and partly by the small scale of farms. Remarkably, this decline in agricultural performance in Botswana has coincided with a period of major policy reform, the objective of which is to improve agricultural performance. This study measures the performance of the agricultural sector and investigates the reasons for continuing decline in spite of considerable public expenditure. Using panel data from 1979 to 2012, the study calculates various indicators to assess the different drivers of the performance of the sector across different agricultural districts, agro-ecological regions, production systems and sub-sectors. A nonparametric approach is employed to examine trends in agricultural productivity in six regions of Botswana. Measures of total factor productivity (TFP) are obtained and decomposed into various sources including efficiency change (technical, scale and mix efficiency) and technical change. The results show that TFP declined due to a fall in overall efficiency at 3.1 per cent per annum. Moreover, a parametric stochastic distance frontier approach is used to examine sources of efficiency, productivity and output growth and the possible reasons for the decline in productivity. It was found that the main driver of productivity is improvement in technical efficiency. The results show that various programs introduced during the study period did not lead to any improvement in productive efficiency. Results from both parametric and nonparametric approaches indicate that overall efficiency varies from region to region, which suggest that there is a scope for improving productivity by taking a differential regional approach to efforts aimed at increasing efficiency.