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Technical Efficiency of Rice Production in the Upper North of Thailand: Clustering Copula-Based Stochastic Frontier Analysis

Author

Listed:
  • Yaovarate Chaovanapoonphol

    (Department of Agricultural Economy and Development, Faculty of Agriculture, Chiang Mai University, Chiang Mai 50200, Thailand)

  • Jittima Singvejsakul

    (Department of Agricultural Economy and Development, Faculty of Agriculture, Chiang Mai University, Chiang Mai 50200, Thailand)

  • Songsak Sriboonchitta

    (Centre of Excellence in Econometrics, Chiang Mai University, Chiang Mai 50200, Thailand
    Faculty of Economics, Chiang Mai University, Chiang Mai 50200, Thailand)

Abstract

This study examines the efficiency of rice production in Thailand, especially major rice, which is the main crop of farmers in all regions of Thailand and is still a pressing issue. Analyzing technical efficiency by using the appropriate analytical tools inevitably brings about determining the correct production efficiency measures. In this study, we applied the K-Means algorithm and copula-based stochastic frontier model to cluster farmer groups in order to find the different factors that impact the group, and to relax the assumption of the two components of random error, which is that they are independent to each other; the correlation of the two components of random error is also represented by the estimation of copula. The findings from the K-Means clustering algorithms applied in this study indicate that the production frontiers can be divided into two frontiers, with the number of farmers under the frontiers of such production differing from the number of farmers collected in each area. The production frontiers were obtained with 591 farmers under the first production frontier and 65 farmers under the second. In addition, the results reflected a correlation between the two error components U and V . This suggests inefficiencies and zero-mean, and that the symmetric error is not independent of each other. The findings from the application of the copula-based stochastic frontier production function models indicate that land, cost of chemicals, and labor inputs have significant positive effects on the mean output of major rice in both groups of farmers. Therefore, the results of this study indicate that the financial services in rural areas should be continuously promoted by governmental policy, particularly via agricultural loans, to rural people since the utilization of inputs affects the quantity of rice produced. Timely loans should be encouraged.

Suggested Citation

  • Yaovarate Chaovanapoonphol & Jittima Singvejsakul & Songsak Sriboonchitta, 2022. "Technical Efficiency of Rice Production in the Upper North of Thailand: Clustering Copula-Based Stochastic Frontier Analysis," Agriculture, MDPI, vol. 12(10), pages 1-13, October.
    • Handle: RePEc:gam:jagris:v:12:y:2022:i:10:p:1585-:d:931381
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    References listed on IDEAS

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    2. Pedroso, Rui & Tran, Dang Hoa & Viet, Trinh Quoc & Le, An Van & Dang, Khoa Tran & Le, Khac Phuc, 2018. "Technical efficiency of rice production in the delta of the Vu Gia Thu Bon river basin, Central Vietnam," World Development Perspectives, Elsevier, vol. 9(C), pages 18-26.
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    4. Valerien O. Pede & Francisco J. Areal & Alphonse Singbo & Justin McKinley & Kei Kajisa, 2018. "Spatial dependency and technical efficiency: an application of a Bayesian stochastic frontier model to irrigated and rainfed rice farmers in Bohol, Philippines," Agricultural Economics, International Association of Agricultural Economists, vol. 49(3), pages 301-312, May.
    5. Matheus Koengkan & José Alberto Fuinhas & Emad Kazemzadeh & Fariba Osmani & Nooshin Karimi Alavijeh, 2022. "Measuring the economic efficiency performance in Latin American and Caribbean countries: An empirical evidence from stochastic production frontier and data envelopment analysis," International Economics, CEPII research center, issue 169, pages 43-54.
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    Cited by:

    1. Han Zhang & Dongli Wu, 2023. "The Impact of Agricultural Factor Inputs, Cooperative-Driven on Grain Production Costs," Agriculture, MDPI, vol. 13(10), pages 1-17, October.
    2. Roengchai Tansuchat, 2023. "A Copula-Based Meta-Stochastic Frontier Analysis for Comparing Traditional and HDPE Geomembranes Technology in Sea Salt Farming among Farmers in Phetchaburi, Thailand," Agriculture, MDPI, vol. 13(4), pages 1-23, March.
    3. Meidiana Purnamasari & Wen-Chi Huang & Bambang Priyanto, 2023. "The Impact of Government Food Policy on Farm Efficiency of Beneficiary Small-Scale Farmers in Indonesia," Agriculture, MDPI, vol. 13(6), pages 1-14, June.

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