EVALUATING THE TECHNICAL EFFICIENCY OF SMALLHOLDER VEGETABLE FARMS IN DIVERSE AGROECOLOGICAL REGIONS OF NEPAL
Abstract
Enhancing the efficiency of vegetable farms is crucial to increase the vegetable outputs for
meeting the demand for growing population. This study evaluated the technical efficiency and
explored factors determining the efficiencies of smallholder vegetable farms in diversified
agro-ecological regions using Stochastic Frontier Analysis (SFA) with cross-section data
collected in 2013. The results revealed that average technical efficiency was found to be 0.77
and the variance parameters were highly significant indicating that the inefficiency existed in
vegetable farms. The inefficiency gap could improve by operating the farms at the frontier
level. The input variables consisting of land, labor, animal power, fertilizer, compost,
pesticide, and capital were proved to be the important factors in determining the level of
outputs. Meanwhile, the major sources of the inefficiencies identified were: age of farmer,
training to the farmers, and infrastructure development. The efficiency in vegetable production
can be improved by allocating input resources at the optimum levels, encouraging younger
farmers in vegetable production, increasing training and extension activities, enhancing
market access to the farmers, and developing infrastructures with regard to vegetable
production.
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56364
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