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Stochastic Frontier and Technical Efficiency of Farms in Irrigated Areas of Pakistan's Punjab

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  • Abid A. Burki

    (Department of Economics, Quaid-i-Azam University, Islamabad.)

  • Haq Nawaz Shah

    (Punjab Economic Research Institute, Lahore.)

Abstract

This paper presents new evidence on technical efficiency and its sources by examining the cost behaviour of 387 farms and whole-farm data from five irrigated districts of Punjab. Fitting translog variable cost frontier we find that technical inefficiency raises the cost of average sample farms by 24 percent that could have been saved had the farms been technically efficient. Our results enable us to conclude that farm efficiency is positively related to formal schooling of farm operators, abundance of canal water, and head reaches of mogha, and negatively to farm size, while the age of farm operators has no effect on efficiency.

Suggested Citation

  • Abid A. Burki & Haq Nawaz Shah, 1998. "Stochastic Frontier and Technical Efficiency of Farms in Irrigated Areas of Pakistan's Punjab," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 37(3), pages 275-291.
    • Handle: RePEc:pid:journl:v:37:y:1998:i:3:p:275-291
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    References listed on IDEAS

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    2. Karunarathna, Muditha & Wilson, Clevo, 2017. "Agricultural biodiversity and farm level technical efficiency: An empirical investigation," Journal of Forest Economics, Elsevier, vol. 29(PA), pages 38-46.
    3. Umar Farooq & Trevor Young & Noel Russell & Muhammad Iqbal, 2001. "The supply response of basmati rice growers in Punjab, Pakistan: price and non-price determinants," Journal of International Development, John Wiley & Sons, Ltd., vol. 13(2), pages 227-237.

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