Farm-size-specific technical efficiency: A stochastic frontier analysis for rice growers in Bangladesh

Author

K M M Rahman, M I Mia and M A Alam

Bangladesh Journal of Agricultural Economics, 2012, vol. 35, issue 1-2

Abstract: The study was conducted during 2008-2009 to estimate the farm-size-specific technical efficiency of rice growers. The technical efficiency scores were estimated using stochastic production frontiers. The large farms received the highest yield (4772.83 kg) per hectare while marginal farms received the lowest yield (4610.53 kg). Gross return was found to be the highest for small farms and net return was the highest for marginal farms. The marginal farm experienced the highest benefit-cost ratio (BCR) followed by small, medium and large farm respectively. The average technical efficiency for large, medium, small, marginal and all farms were respectively 0.88, 0.92, 0.94, 0.75 and 0.88. There was significant technical inefficiency in the production of rice for marginal farms indicating that production could be increased by increasing efficiency with the existing technology for marginal farms. Farm management could help in increasing production in marginal farms. For other farms,increased managerial capacity was not enough for increasing production. New investment and advanced technology were needed to increase production in these farms. Farmers could increase 12 percent output with application of inputs and production technology at the aggregate level. The costs of fertiliser, manure, irrigation, insecticide and area and experience were important factors to increase production. Age, education and family size had negative impact on technical inefficiency whereas land had positive impact on technical inefficiency.

Keywords: technical efficiency; farm-size-specific; rice; frontier function; Bangladesh; Agricultural and Food Policy; Crop Production/Industries; Farm Management; Production Economics; Productivity Analysis; Q12; Q16 (search for similar items in EconPapers)
Date: 2012
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