Analysis of the Technical Efficiency of Rice Production in Fogera District of Ethiopia: A Stochastic Frontier Approach

Abstract

The aim of this paper is to analyze the technical efficiency of rice production in
Fogera District of Ethiopia. To do so, the stochastic frontier approach was
employed on a data collected from 200 sample households in the 2015/16
production year. As a result, it was found out that except for manure, all variables
in the Cobb-Douglass stochastic frontier model, which includes land, fertilizer,
oxen, seed, and labor, were positively and significantly related to rice production.
The average technical efficiency score predicted from the estimated Cobb-Douglas
stochastic frontier production function was calculated to be 77.2 percent, implying
that there was a room for rice yield increment by improving the resource use
efficiency of households. The study also revealed that the provision of extension
services, training on rice product improvement, experience on rice farming,
agrochemicals, and education tend to be positively and significantly related to
technical efficiency while household size was negatively and significantly related.
Thus, strengthening the extension service provision and the training on rice yield
increment, campaigns to disseminate rice farming experiences, and an increase in
the supply of agrochemicals were crucial to improve the technical efficiency of
rice production in the study area.