Date of this Version
Journal for the Advancement of Developing Economies 2015 Volume 4 Issue 4
This research was conducted to estimate the technical efficiency and determinants of onion production, by using the Cobb-Douglas stochastic frontier production function with the inefficiency effects model. A multistage sampling technique was used to collect data, randomly, from 93 respondents. The empirical results showed that urea, farm yard manure (FYM), irrigation, and pesticides were the major factors that influence changes in onion production. Farm-specific variables such as education and area were found to have significant effects on the technical inefficiency among the onion producers. The technical efficiency of farmers varied from 0.7478 to 0.9851 with a mean technical efficiency of 0.9425. The implication of the study is that efficiency in onion production among the farmers could be increased by 6% through better use of urea, FYM, irrigation, and pesticides in the short term given the existing state of technology. The estimated gamma (γ) value was found to be 0.93, which shows that 93% variation in production of onions was due to inefficiency factors. In order to increase the production of onions by taking advantage of a high-efficiency level of the farmers, they should be motivated to adopt new techniques of farming and improved hybrid technology, by providing either formal or informal education.