Factors Affecting Cost Efficiency of Cambodian Rice Farming Households

Abstract

Using the Cambodia Socio-Economic Survey (CSES) 2009, this study tested the cost efficiency of Cambodian rice farming households. The wet and dry season cases were examined separately; the results showed the evidence of cost inefficiency among the wet season farming households, while among the dry season farming households, there was no significant evidence. When taking into account differences in agro-climatic zones, only wet season rice farming households in Tonle Sap and Plateau/ Mountain zones were found to have cultivated inefficiently. There was no evidence of inefficiency among dry season rice farming households in all agro-climatic zones. The mean cost efficiency score of 1.2 and 1.3 were obtained respectively for Tonle Sap and Plateau/Mountain zones. If the efficiency score equals one, the farming households are cost efficient and if it is larger than one, the farming households are cost inefficient. The mean score of 1.2 and 1.3 indicates that, on average, wet season rice farming households in these two regions were operating on about 20% and 30% over the minimum cost frontier, i.e 20% or 30% of their resources respectively were wasted. The results of the factors affecting cost efficiency suggested that there should be an appropriate number of farmers cultivating in a plot of land. If too many farmers cultivate in a small plot of land, cost efficiency will drop. Cost efficiency can also be improved if farming households are able to increase their cultivated area given the same number of farmer member of household, or reduce the number of household members who cultivate rice.