An empirical analysis of the role of agriculture in accelerated development in two districts of Bophuthatswana, 1978-1991

Abstract

The planning of agricultural development and the implementation of its policy requires knowledge of the impacts and necessary adjustments that would take place as a result of the introduction of a new approach to agricultural practices. In essence, the effects of an improved approach to agricultural development could be characterised by impacts on the cost structures or the product mix of individual firms; with shifts in individual demand curves for production factors; shifts in product supply curves; impacts on growth and development as well as impacts on the distribution of the total and per capita income. The analysis and understanding of these effects provide useful information to the decision-making process in setting up guidelines for research, policy issues and the planning of research activities for agricultural development. The main purpose of this study has been to increase knowledge on the role of agriculture for accelerated development in the area of study, and to contribute information on how it can affect the economic growth and development of the region. Specifically, the objectives of this research were: 1. to examine and analyse the role of agriculture for accelerated development in Bophuthatswana during the period of independence up to 1991; 11. to examine the implementation of an agricultural development policy with the political commitment to reduce poverty; 111. to investigate the obstacles and opportunities of the agricultural development process and its redirection for economic development; 1v. to compare the appropriateness of the agricultural development process with the present theory of agricultural production; v. to analyse certain popular opinions about the importance of the agricultural development process in the area of study, and

v1. to develop an econometric model for analysis of some specific objectives of this research. The focus of this study was on the development of an analytical framework which could be used to analyse the potential role of agriculture for accelerated development in Bophuthatswana up to 1991. The instrument of analysis has been a regional macro-economic Cobb-Douglas model of farmer's decision-making with respect to resource allocation and production. The main purpose of the model was to determine the capacity of crop production and other farm resources on the basis of their opportunity costs within alternative usage. The results of the study indicated that in response to agricultural policy changes, both small and large farmers could change to a certain extent with change in land utilisation, crop production, input demand and income patterns over time. These elements were explained by the magnitude of the coefficients of elasticities calculated for both crops analysed in this study. The introduction of new farming methods would lead to significant increases in the areas under maize and wheat production. The nett returns to resources in farming could also be increased significantly with improvements in crop yields and productivity. Because of different types of technology used by both small and large farmers, income of the large farmers showed a significant growth rate in comparison to small farmers. The role_ of agriculture for economic growth and development has been described in this study as one of the most important factors contributing to the GDP of a country. A good agricultural sector has been the "cultural back bone" of many a nation in providing cheap basic food, raw materials and also contribution to foreign exchange earnings. The agricultural sector also has a key role to perform in the industrialisation process of the national economy. This research suggests that to promote agricultural growth and development in the study areas, policy instruments should be directed and based on a well defined set of objectives on the one hand and on the other hand it should also take into consideration the interrelationships among farm size groups, the existing state -of the agricultural sector and the conditions prevailing in the rural areas.