TECHNICAL EFFICIENCY AND THE TECHNOLOGY GAP IN WETLAND RICE FARMING IN INDONESIA: A METAFRONTIER ANALYSIS

Mohammad Junaedi, Heny Kuswanti Suwarsinah Daryanto, Bonar Marulitua Sinaga and Sri Hartoyo

International Journal of Food and Agricultural Economics (IJFAEC), 2016, vol. 04, issue 2, 12

Abstract: Diversity in the characteristics between regions is why different kinds of technology are used in wetland rice farming in Indonesia. These differences lead to a technology gap which then makes it nearly impossible to compare the maximum production sizes (the frontiers) of each region. This study is aimed to observe the factors that affect production, efficiency, and the technology gap in wetland rice farming using the data from 4,203 wetland rice farmers in 4 regions in Indonesia which were obtained from the Cost Structure of Food Crops Production Survey 2011 conducted by the BPS-Statistics Indonesia. This study was conducted using a metafrontier analysis to prove that the efficiency level in the 4 regions could not be compared to each other. In general, all the coefficients of the production function variables were positive and significant, as expected. The size of the harvested area was the strongest factor in influencing wetland rice production. The ten socio-economic variables in this study had various effects on the inefficiency of rice farming in each region. This study also demonstrated that the use of technical efficiency measurements taken based on their respective region’s frontier would lead to biased and misguided policies; therefore, special notes are required in the analysis.

Keywords: Agricultural and Food Policy; Crop Production/Industries; Production Economics; Productivity Analysis; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ijfaec:234909

DOI: 10.22004/ag.econ.234909

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