DETERMINANTS OF COFFEE PRODUCTION IN THE KENYAN ECONOMY

Abstract

Purpose: To establish determinants of coffee production in the Kenyan economy  Methodology: The study adopted descriptive survey research. The target population consisted ofResults: Results from the first model indicate that there exists a negative relationship between coffee output with credit advanced to farmers. Findings also did show there also exists a positive relationship between coffee output with coffee price, hectarage planted and price of input (fertilizer). Results further indicate that there is a significant negative relationship between the depreciation of the exchange rate and the coffee output.Unique contribution to theory, practice and policy: The study recommended that the Kenya government may put in place measures and policies aimed at improving coffee production in Kenya, ie, financial institutions may be encouraged to lend loans to coffee farmers at no low interest rates. The study recommended that the government should introduce subsides aimed at reducing cost of inputs hence encouraging farmers to increase areas under coffee production as well as providing incentives to the farmers to encourage them engage in coffee farming. The sturdy also recommended that government may also set up factories or encourage investors, both local and foreign to set up factories that will process coffee to the final product within the country.