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Technical Efficiency and its Determinants in Tomato Production in Karnataka, India: Data Envelopment Analysis (DEA) Approach

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  • Murthy, D. Sreenivasa
  • Sudha, M.
  • Hegde, M.R.
  • Dakshinamoorthy, V.
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    Abstract

    Low productivity in agriculture is mainly due to the inability of the farmers to exploit the available technologies fully, resulting in lower efficiencies of production. The present study has estimated the technical and scale efficiencies of tomato-producing farms in Karnataka, considering different production levels and has identified the determining factors of their technical efficiency. The study is based on the data collected from the major tomato-producing regions of Karnataka, viz. Kolar and Bangalore rural districts of Karnataka, under three-production situations, viz. small, medium and large farms. Data Envelopment analysis (DEA) and log linear regression models have been used for estimating the technical efficiency and its determining factors, respectively. The study has indicated that most of the farms irrespective of size of holding have shown technical inefficiency problems. The medium farmers have been observed with best measures of technical efficiency, which has been explained by factors such as the land and labour productivity and education. Though medium farmers have been found efficient, with higher yields, it is the small farmers who have emerged as price-efficient producers in terms of lower cost on production (Rs 1.72/kg compared to Rs 2.01 in medium farms and Rs 1.85 in large farms) and higher unit profit. Most of the farms have been observed to have potential to expand production and productivity, increasing technical efficiency as majority have been performing with increasing returns to scale.

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    Bibliographic Info

    Article provided by Agricultural Economics Research Association (India) in its journal Agricultural Economics Research Review.

    Volume (Year): 22 (2009)
    Issue (Month): 2 ()
    Pages:

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    Handle: RePEc:ags:aerrae:57399

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    Keywords: Agricultural and Food Policy;

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    1. Fare, Rolf & Grosskopf, Shawna, 1994. "Estimation of returns to scale using data envelopment analysis: A comment," European Journal of Operational Research, Elsevier, vol. 79(2), pages 379-382, December.
    2. Battese, George E., 1992. "Frontier production functions and technical efficiency: a survey of empirical applications in agricultural economics," Agricultural Economics: The Journal of the International Association of Agricultural Economists, International Association of Agricultural Economists, vol. 7(3-4), October.
    3. Battese, George E. & Coelli, Tim J., 1988. "Prediction of firm-level technical efficiencies with a generalized frontier production function and panel data," Journal of Econometrics, Elsevier, vol. 38(3), pages 387-399, July.
    4. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    5. K. Kalirajan, 1981. "An Econometric Analysis of Yield Variability in Paddy Production," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 29(3), pages 283-294, November.
    6. Coelli, Tim J. & Battese, George E., 1996. "Identification Of Factors Which Influence The Technical Inefficiency Of Indian Farmers," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 40(02), August.
    7. Renato Villano & Euan Fleming, 2006. "Technical Inefficiency and Production Risk in Rice Farming: Evidence from Central Luzon Philippines ," Asian Economic Journal, East Asian Economic Association, vol. 20(1), pages 29-46, 03.
    8. Battese, George E., 1992. "Frontier production functions and technical efficiency: a survey of empirical applications in agricultural economics," Agricultural Economics, Blackwell, vol. 7(3-4), pages 185-208, October.
    9. Bozoglu, Mehmet & Ceyhan, Vedat, 2007. "Measuring the technical efficiency and exploring the inefficiency determinants of vegetable farms in Samsun province, Turkey," Agricultural Systems, Elsevier, vol. 94(3), pages 649-656, June.
    10. Afriat, Sidney N, 1972. "Efficiency Estimation of Production Function," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 13(3), pages 568-98, October.
    11. Bhattacharyya, Anjana & Bhattacharyya, Arunava & Kumbhakar, Subal C., 1996. "Government Interventions, Market Imperfections, and Technical Inefficiency in a Mixed Economy: A Case Study of Indian Agriculture," Journal of Comparative Economics, Elsevier, vol. 22(3), pages 219-241, June.
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