Irrigation, Technical Efficiency, and Farm Size: The Case of Brazil

Gabriel A Sampaio Morais,Felipe F Silva,Marcelo José Braga,Carlos Otávio De Freitas

doi:10.3390/su13031132

Abstract

In developing countries, irrigation can help to decrease poverty in rural areas through increased employment in the agricultural sector. Evidence shows that irrigation may increase farm productivity and technical efficiency. In this paper, we estimate the effect of irrigation on farm technical efficiency in Brazil using the 2006 Agricultural Census dataset on more than 4 million farms. We estimate a stochastic production frontier at farm level, considering potential selection bias in irrigation adoption. We find that farms using irrigation are on average 2.51% more technically efficient compared to rain-fed farms. Our findings also suggest that while small farms are more efficient than medium and large farms, the largest difference in technical efficiency between rain-fed and irrigated farms is among large farms. Our results indicate that policies that seek to support expansion of irrigation adoption has also the potential to achieve greater rural development given the estimated effects estimated in this paper among very small and small farms, which are more than 70% of the farms in Brazil.

Highlights

The difference in technical efficiency between irrigators and rain-fed farmers has been widely studied
This result may be related to the low proportion of rain-fed farmers that received rural extension and accessed financial resources when compared to irrigators (Table 1)
There is evidence that indicate that irrigation in Brazil may be an effective tool deal with climate vulnerability [1,6] and to reduce poverty through increase in productivity, profit and technical efficiency

Summary

Introduction

The difference in technical efficiency between irrigators and rain-fed farmers has been widely studied. Compared technical efficiency of irrigated and rain-fed rice farms in Northern Ghana and found that, on average, farms using irrigation were 9.2% more efficient than the rain-fed farms. They reinforce the need for investment in irrigation infrastructure as a mechanism to reach poverty reduction and food security. Opata et al [34] found that irrigators were 38% more technically efficient than rain-fed farmers in rice production in Nigeria. Mkanthama et al [35] found a great difference in technical efficiency in rice production in Tanzania, where technical efficiency was 96% for irrigators compared to 39% for rain-fed farmers. Lower technical efficiency for rain-fed producers was found by Makombe et al [36], where rain-fed farmers’ technically efficiency was 6% and for irrigators around 24%

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Conclusion