Advanced Search
MyIDEAS: Login

Allocative Efficiency and Input Subsidy in Asian Agriculture

Contents:

Author Info

  • Asraul Hoque

    (Deakin University, Australia.)

Registered author(s):

    Abstract

    In this paper, input subsidies (fertiliser subsidies to be exact) have been related to the allocative efficiency of fertiliser input. Fertiliser was singled out not to ignore other inputs but to emphasise the fact that fertiliser accounts for at least 30 percent of the total farm expenditure in most of Asia, and the rest of the expense is accounted for by labour (which is primarily family labour). The regression results are based on a sample survey data of 150 farms of Khulna Division (Bangladesh) for the year 1986-87. We have first estimated a production function based on Hoque (1991) and then calculated the efficiency indices based on the estimated parameters of the production function. In the second stage regression, different farm sizes were regressed on efficiency indices which showed an overall inverse relationship (that is, the smaller the farm size, the higher the efficiency). This tendency is observed upto the size of 10 acres in case of fertiliser input. Thus, the farms upto the size of 10 acres should be subsidised to promote efficiency in production. However, if the selective subsidy programme is difficult to administer, one hundred percent subsidy may be worthwhile. It is argued that the withdrawal of the fertiliser subsidy will reduce efficiency and have an adverse impact on employment and output in the rural sector of Asia. The IFPRI (1987) study on Indonesia also clearly indicates this. Some indicative discussions in Section II and Section V support the statistical results in favour of fertiliser subsidy.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.pide.org.pk/pdf/PDR/1993/Volume1/87-99.pdf
    Download Restriction: no

    Bibliographic Info

    Article provided by Pakistan Institute of Development Economics in its journal The Pakistan Development Review.

    Volume (Year): 32 (1993)
    Issue (Month): 1 ()
    Pages: 87-99

    as in new window
    Handle: RePEc:pid:journl:v:32:y:1993:i:1:p:87-99

    Contact details of provider:
    Postal: P.O.Box 1091, Islamabad-44000
    Phone: (92)(51)9248051
    Fax: (92)(51)9248065
    Email:
    Web page: http://www.pide.org.pk
    More information through EDIRC

    Related research

    Keywords:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Parish, Ross M. & McLaren, Keith Robert, 1982. "Relative Cost-Effectiveness Of Input And Output Subsidies," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 26(01), April.
    2. Bardhan, Pranab K, 1973. "Size, Productivity, and Returns to Scale: An Analysis of Farm-Level Data in Indian Agriculture," Journal of Political Economy, University of Chicago Press, vol. 81(6), pages 1370-86, Nov.-Dec..
    3. Hoque, Asraul, 1991. "An Application and Test for a Random Coefficient Model in Bangladesh Agriculture," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 6(1), pages 77-90, Jan.-Marc.
    4. McMillan, John & Whalley, John & Zhu, Lijing, 1989. "The Impact of China's Economic Reforms on Agricultural Productivity Growth," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 781-807, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:pid:journl:v:32:y:1993:i:1:p:87-99. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Khurram Iqbal).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.