Estimation of Resource Use Efficiency and Technical Efficiency of Small Onion Farmers in Tamil Nadu: A Cobb-Douglas and Stochastic Frontier Approach

Abstract

This paper investigates the determinants of the resource use efficiency and technical efficiency of onion production. Farm-level data were collected using a structured questionnaire administrated to 90 randomly selected onion growers in Perambalur district of Tamil Nadu. The empirical results show that, bulbs, plant protection chemicals and human labour, machine hours, and phosphorous have a positive and significant influence on onion yield. Economic efficiencies are more than one for bulb, nitrogen, phosphorous, potash, plant protection chemicals, machine hours, land size values, farmyard manure and human labour in onion production which meant that these resources are being used at suboptimum level and there exists the possibility of increasing the yield of onion by increasing their use. The technical efficiency for the farms was estimated to be 78%, which indicates the possibility of increasing the yield of onion by adopting better technology. This study suggested that development of awareness of modern agricultural practices through demonstration, farm visits, framers meetings etc., by the government as well as removal all inputs distributional bottlenecks would ensure increased onion production in the study area.