Journal of
Development and Agricultural Economics

  • Abbreviation: J. Dev. Agric. Econ.
  • Language: English
  • ISSN: 2006-9774
  • DOI: 10.5897/JDAE
  • Start Year: 2009
  • Published Articles: 541

Full Length Research Paper

Efficiency change in Thailand rice production: Evidence from panel data analysis

Orawan Srisompun1* and Somporn Isvilanonda2
1Department of Agricultural Technology, Faculty of Technology, Mahasarakham University, Mahasarakham 44150, Thailand.  2Department of Agricultural and Resource Economics, Faculty of Economics, Kasetsart University, Bangkok 10900, Thailand.
Email: [email protected]

  •  Published: 26 February 2012

Abstract

The impact of modern rice varieties (Mvs) adoption over the past few decades has undergone changes in Thailand's rice production. This has led to the increase in average rice yields in both wet and dry seasons. At the present time, the average rice yield per rai nearly reached the maximum point given the current production technology. The findings indicated that the cost of rice production increased to about 85.67% from those in the last few decades. Machinery, fertilizer and land use costs came out most significant in the outlay. Therefore, even though the paddy price sharply increased in the 2007/08 crop year, production costs went even higher, causing many farmers to suffer from production loss. By estimating the production frontier, it reveals that rice production in general operates in a decreasing return to scale, suggesting the ineffectual yield of the input factor use to rice performance. The technical efficiency score of 88.32% in 1987/88 crop year and decreasing to 72.63% in 2007/08 crop year denotes a production trend that is less than the potential output possible over time. The study suggests crop diversification as one strategy to improve production efficiency at the farm level and supervised credit on fertilizers and seeds to farmers to provide farm managerial support.

 

Key words: Rice production, technical efficiency, time-varying model, efficiency change, Thailand.