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Technical Efficiency of Red Pepper Production: The Case of Dalocha, Southern Ethiopia

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  • Lagiso, Degineh
  • Geta, Endrias

Abstract

Increasing the productivity of red pepper is important to meet the need of ever increasing population. However, farmers faced the problem of productivity due to the lack of knowledge on how to maximize level of output at a given level of inputs. The objective of this study was to assess the technical efficiency of red pepper production in Dalocha district of southern Ethiopia. Cobb-Douglas stochastic frontier model was used to estimate the technical efficiency and its determinants in red pepper production. Maximum likelihood estimation results showed that increasing input variables (oxen power, seed, labor and fertilizer) would increase yield of red pepper. The discrepancy ratio,γ, which measures the relative deviation of output from the frontier level due to inefficiency was about 85 percent indicating that about 85% of variation in red pepper yield among the farmers was attributed to technical inefficiency effects. The mean technical efficiency of farmers was about 80%. The implication is that, there is an opportunity to improve technical efficiency among farmers on average by 20% through efficient use of inputs. Thus, it is possible to improve technical efficiency through utilizing available inputs wisely.Â

Suggested Citation

  • Lagiso, Degineh & Geta, Endrias, 2019. "Technical Efficiency of Red Pepper Production: The Case of Dalocha, Southern Ethiopia," Asian Journal of Agricultural Extension, Economics & Sociology, Asian Journal of Agricultural Extension, Economics & Sociology, vol. 37(1).
    • Handle: RePEc:ags:ajaees:357699
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    References listed on IDEAS

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    1. Mekdes Dessie & Teshale Woldeamanuel & Getachew Mekonnen, 2017. "Value Chain Analysis of Red Pepper: The Case of Abeshge District, Guragie Zone, South Ethiopia," International Journal of Environmental Sciences & Natural Resources, Juniper Publishers Inc., vol. 2(3), pages 94-101, June.
    2. Kodde, David A & Palm, Franz C, 1986. "Wald Criteria for Jointly Testing Equality and Inequality Restriction s," Econometrica, Econometric Society, vol. 54(5), pages 1243-1248, September.
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