Resource use efficiency and economic losses: implications for sustainable rice production in Vietnam

Abstract

The study aimed to estimate resource use efficiency and economic losses by using stochastic frontier analysis. The data set were collected in An Giang Province of Vietnam through personal interviews with 199 rice farmers. The results revealed that returns to scale are decreasing. Rice farmers had high levels of output-oriented and input-oriented technical efficiency with the means of 91.92 and 85.39 %, respectively. The mean environmental efficiency was 82.03 %. The mean efficiency of normal inputs was 61.20 %. Among the bad inputs, pesticide and energy were the least efficient ones with the mean values of 51.39 and 45.53 %, respectively, indicating serious overuses of these inputs. As regards normal inputs, capital had the lowest efficiency score at 21.08 %, followed by seed quantity at 26.4 %. Further, the total economic losses were estimated at 8261 thousand VND (380 USD) per hectare, which is equal to the sales of about 1600 kg of rice per hectare or the efforts to increase by 20 % of output level. This study suggests that rice farmers need to contract inputs, particularly environmentally detrimental inputs to improve profits. To improve the productive efficiency, the use of ecological engineering, collective pump and cultivation of three rice crops per year are possible options.