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Economic Efficiency of Rice Production in Smallholder Irrigation Schemes: A Case of Nkhate Irrigation Scheme in Southern Malawi

Author

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  • Magreta, Ruth
  • Edriss, Abdi-Khalil
  • Mapemba, Lawrence D.
  • Zingore, S.

Abstract

This study used a parametric frontier approach to analyze technical, allocative and economic efficiency of smallholder rice farmers. It further explored the factors that influence the efficiency levels of the rice farmers. The study used a trans-log stochastic production function to analyze the technical efficiency. It used the trans-log cost frontier to analyze the economic efficiency. Results from these efficiencies led to the derivation of the allocative efficiency levels. It further used the inefficiency model to analyze the factors underlying efficiency differentials among the sampled farming households. Results revealed an average technical, allocative and economic efficiency levels of 65%, 59% and 53% respectively. This suggests that farmers have a rice yield potential of 35% to be exploited. The average economic efficiency level entails that farmers can raise their profitability or rice production by 47% by adjusting input use. Soil fertility status, access to credit, household size and farmers experience were the factors that influence the efficiency levels of smallholder rice farmers. It is thus recommended that for improved efficiency levels there is need for better policies and strategies that address input and output markets. Furthermore, farmer groups or associations can play a great role in ensuring that farmers get relevant technical advice, credit access as well as learn and share knowledge from each other.

Suggested Citation

  • Magreta, Ruth & Edriss, Abdi-Khalil & Mapemba, Lawrence D. & Zingore, S., 2013. "Economic Efficiency of Rice Production in Smallholder Irrigation Schemes: A Case of Nkhate Irrigation Scheme in Southern Malawi," 2013 Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 161636, African Association of Agricultural Economists (AAAE).
    • Handle: RePEc:ags:aaae13:161636
    DOI: 10.22004/ag.econ.161636
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    References listed on IDEAS

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    1. Liu, Zinan & Zhuang, Juzhong, 2000. "Determinants of Technical Efficiency in Post-Collective Chinese Agriculture: Evidence from Farm-Level Data," Journal of Comparative Economics, Elsevier, vol. 28(3), pages 545-564, September.
    2. Tchale, Hardwick, 2009. "The efficiency of smallholder agriculture in Malawi," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 3(2), pages 1-21, September.
    3. Tchale, Hardwick & Sauer, Johannes, 2007. "The efficiency of maize farming in Malawi. A bootstrapped translog frontier," Cahiers d'Economie et de Sociologie Rurales (CESR), Institut National de la Recherche Agronomique (INRA), vol. 82.
    4. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-332.
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    Cited by:

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