Crop Diversification and Its Efficiency in Rashda Village, Dakhla Oasis

Abstract

In an arid climate region, where available water is limited, one of the important strategies to optimize the production is to diversify their crop cultivation. This chapter analyses farmers’ diversification strategies focusing on crop production in Rashda village in Dakhla Oasis. Technical and scale efficiency of farms in Rashda of Egypt is investigated by using DEA (Data Envelopment Analysis) approach. Using cross section data of agricultural households collected from the household survey in Rashda in 2009, technical and scale efficiency were estimated in the first stage. As a second stage, the OLS model was estimated to find factors associate with higher efficiency. Results suggest the estimated efficiency scores of agricultural households in Rashda are generally low, where the majority of farms show less than 40% of technical efficiency. Yet, estimated results also suggest the level of output can be increased by 82.5%, 79.8% under the CRS, VRS specifications, respectively, with the current level of inputs. About 24.6% of farms can increase their production and productivity through increasing their inputs, while 24.1% can improve their productivity by reducing their inputs. While the crop diversification does not contribute to improve efficiency, the expansion of cultivation of water-saving crops such as dates is a positive factor for improving efficiency. Human capital accumulation, increase experience and intensification of family labor use would contribute to improve technical efficiency. These results imply that the simple diversification of crop production does not result in improved efficiency. The farmers who intensify in date fruits which is a high value crop, have highest score of efficiency. In contrast, the farmers who cultivate wheat, fodder crops along with rice demonstrate low efficiency, which is from household consumption side point of view a rational choice in order to secure the household’s basic food need.KeywordsCrop diversificationHousehold surveyData envelopment analysisTechnical efficiencyFarmerEgypt