Variations in technical efficiency of farmers with distinct land size across agro-climatic zones: Evidence from India

Abstract

This paper attempts to analyze the variations in technical efficiency of the individual farmers of distinct (small, medium and large) size of land holdings and different types (family and hired) of labor with given set of input variables for the agricultural production across different Agro-Climatic Zones. A field survey was conducted to collect the information from a randomly stratified sample of 300 farmers operating in six districts falls under Trans-Gangetic Plains and Semi Sandy Desert zones of the states of Punjab and Haryana in India. A model of stochastic frontier analysis for cross sectional data with half normal truncated features has been used to measure the technical efficiency under the assumptions of Cobb-Douglas production function. The model comprises eight dummy variables for the farmers owning distinct size of land and using distinct type of labor in their production. The results for the estimates of technical inefficiency with family and hired labor depict; small farmers are 50.30 and 68.11 per cent, medium farmers are 61.09 and 67.75 per cent, large farmers are 71.03 and 56.67 per cent and average farmers are 71.94 and 70.07 per cent inefficient respectively. This paper helps the farmers and the policy makers in identifying the second best-alternative crop for obtaining the sustainable agricultural production.