Analysis of technical efficiency of rice production in fogera district of Ethiopia: A stochastic frontier approach

Lema, Tadesse Zenebe and Tessema, Solomon Amare and Abebe, Fentahun Addis (2016): Analysis of technical efficiency of rice production in fogera district of Ethiopia: A stochastic frontier approach.

Abstract

The possible way to improve production and productivity with a given input mix and available technology is to improve efficiency of resource use. For this purpose examining the technical efficiency of the production process is very crucial. Thus, the aim of this paper is to analyze the technical efficiency of rice production in Fogera District of Ethiopia. To do so, stochastic frontier approach is employed on a data which is collected from 200 sample households in 2015/16 production year. The sampling techniques used to get those 200 sample households is a multistage sampling where in the first stage five Kebeles were purposively selected, in the second stage two Gotes randomly selected from each Kebeles and in the third stage 200 households were selected using simple random sampling technique. Doing so, it was found that except manure all the variables in the Cobb-Douglass stochastic frontier model which includes; land, fertilizer, oxen, seed and labor are found to be positively and significantly related to rice production. The average technical efficiency score predicted from the estimated Cobb-Douglas stochastic frontier production function is found to be 77.2% implying that there is a room for rice yield increment by improving the resource use efficiency of the households. The study also revealed that; provision of extension service, training on rice product improvement, experience on rice farming; agrochemical and education tend to be positively and significantly related to technical efficiency while household size is negatively and significantly related. Thus, strengthening extension service provision and training on rice yield increment, campaigns to disseminate rice farming experiences and increasing the supply of agrochemicals are crucial to improve the technical efficiency of rice production in the study area.

• Item Type: MPRA Paper
• Language: English
• Keywords: Ethiopia, Fogera District, Technical Efficiency, Cobb-Douglas Production Function, Stochastic Frontier Approach
• Subjects: D - Microeconomics > D2 - Production and Organizations > D24 - Production ; Cost ; Capital ; Capital, Total Factor, and Multifactor Productivity ; Capacity

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