A Nonparametric Approach to Evaluate Technical Efficiency of Rice Farms in Central Thailand

Abstract

Rice is an important strategic crop for Thai farmers whose rice production has been increasing from the expansion of planted area and not from the average yield per acreage. This study aims to investigate technical efficiency of rice farms in Central Thailand where the highest rice output per acreage has been achieved and rice could be grown twice a year. Technical Efficiency was evaluated by using the nonparametric approach, the Data Envelopment Analysis Approach (DEA) on 400 rice farms in crop year 2009/2010. Tobit regression model employed in this study provides the results on factors affecting technical inefficiency. The results show that the average technical efficiency was 51.86 percent. The estimated technical efficiencies of the farmers ranged between 0.30 percent and 100 percent. This indicates that most farms are likely to be operating at lower level of technical efficiency. The finding reveals that there is a positive relationship between farm efficiency and family labor, extension officer’s service, certified seed use and pest control on weedy rice and insect.