Abstract
The study was designed to estimate the restricted profit function in district Gujranwala, Punjab, Pakistan. Data were collected from 100 respondents using proportional allocation sampling tech-nique. The analysis was done using SHAZAM software. The results indicate that the farmers are price-responsive. Rice own price elasticity was 1.873. The output supply elasticity of rice with re-spect to education, land, fertilizer price and irrigation cost were 0.0.169, 1.274, -0.873 and -0.953 respectively. Irrigation demand elasticity with respect to education, land, fertilizer price, irrigation cost and output price were 0.14, 1.14, -0.783, -1.84 and 1.78 respectively. Fertilizer demand elasticity with respect to education, land, fertilizer price, irrigation cost and output price was 0.023, 0.792, -1.65, -0.85 and 1.851 respectively. Lastly, the elasticity of profit with respect to education, land, fertilizer price, irrigation cost and output price was 0.20, 1.10, -0.83, -1.136 and 1.92 respectively. The study recommends that Government should provide consistent electricity with stable rates, so that, they irrigate their fields through electric tube wells and ultimately their cost of irrigation decreases. The study also suggests that government should stabilized fertilizer prices to encourage its application. Furthermore, government should raise procurement price of rice to encourage its supply this; it in turn will also increase the profit of the farmer.
Highlights
Agriculture is back bone of economic growth and development in Pakistan
Rice plays a significant role in agrarian economy of the Pakistan
The estimated parameters of translog profit function and input demand equations are used to calculate the elasticities of input demand and output supply in relation to the price of rice, the amount of fixed and changeable inputs prices
Summary
Agriculture is back bone of economic growth and development in Pakistan. Rice is staple food worldwide, in “East, South, Southeast Asia, the Middle East, Latin America, and the West Indies”. It ranked second in production worldwide after maize crop. Pakistan is considered as main rice exporter with share of world trade of 10%, which is about 2 million tons annually. Share of Pakistani basmati rice in export is 25% managed by private traders [3]. The government of Pakistan has taken effective measures to increase the production and quality of export rice. That’s why research efforts are continuing on developing high yielding basmati and IRRI varieties. The flow of input and credits is being substantially increased [4]
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