Agribusiness Incubation, institutional support and implication on livelihood security: A case of selected Sub –Counties In Bungoma County, Kenya By

Abstract

Globally, agribusiness is a critical driver of economic growth with strong multiplier effects. In Africa the benefits of agribusiness are highly constrained and yet there exists potential in agribusiness incubation and institutional support that act as a conduit to secure livelihoods. The main objective of the study was to assess the implications of agribusiness incubation and institutional support on livelihood security in Bungoma County. The specific objectives were to: examine the effect of physical capital for agribusiness incubation on livelihood security; evaluate the impact of financial capital for agribusiness incubation on livelihood security; assess the influence of social capital for agribusiness incubation on livelihood security, and determine the mediating effect of institutional support on agribusiness incubation capitals and livelihood security. The study was guided by the DFID Livelihood Framework. Pragmatic paradigm was employed in the study. A cross-sectional analysis of Bungoma North, Kanduyi, Bumula, Mt Elgon and Webuye West sub- counties, with a total household population of 194,513 was done. Sub-counties were purposively sampled forming the clusters of the study. Simple random sampling was applied to select a sample size of 399 households, and purposively selected, 23 key informants and 10 FGDs. Data was collected using questionnaires, observation schedules, document reviews and interview guides. Qualitative data was thematically analyzed and presented as narrations. Descriptive statistics was analyzed through frequencies, percentages and means. Inferential statistics employed ANOVA, Chi- square test, and logistic model. The findings show that agribusiness productivity is constrained by the small land parcels (77.1% own below 3ha), pests and diseases (95.1%), means of bulk transportation (94.5% rely on motorcycles), and storage (58.8%). Crop production accrues low returns (80.7% earn below Ksh 20,000) with the inability of households to meet credit requirements or access external markets. Credit access and welfare are significant predictors of membership to a social group {χ2 (1, 367) =4.879, p=0.027, <0.05} and {χ2 (1,367) =27.679, p=0.000} respectively. Market prices and bureaucracy were major market constraints {F (4,366) = 5.775, P= 0.000} and {F (4,366) = 3.425, P = 0.009} at the 0.05 alpha level respectively. Minimal impact accrued from the financial capital mediated by institutional support (β =.820, p=0.465). In conclusion, integrated capital oriented strategies and policies are essential in reducing risks and building resilience among agro entrepreneurs , to achieve a sustained increase in production. Institutional support is critical to the optimal agribusiness transformation and mobilization of the agribusiness capitals to enhance productivity, comparative advantage and competitiveness. The study recommends institutional support efforts to be harmonized with the community‟s inherent potential for the attainment of the desired livelihood security. The adoption of a holistic approach is critical for addressing the physical, financial and social agribusiness capital needs concurrently.