An Empirical Analysis of Economic Efficiency and Farm Size of Cotton Farmers
Dilshad Ahmad1* and Muhammad Afzal2
ABSTRACT
This paper attempted to analyze the impact of farm size on the economic efficiency of cotton farmers in southern Punjab of Pakistan. Farm-level allocative, economic and technical efficiency of samples of 240 small, medium and large-scale cotton farmers was estimated using Stochastic Frontier Approach of district Rahim Yar Khan Punjab, Pakistan. Empirical findings of the study indicated that medium farm size cotton farmers were more allocative, technically and economically efficient (0.90, 0.94, 0.85) rather than small farm farmers (0.79, 0.92, 0.76) and large farm farmers (0.70, 0.97, 0.68). Farmers schooling years, formal credit access, own tubewell availability, adequate extension access and sowing cotton crop timely were significant socioeconomic factors that affect farmers efficiency level. Medium farm size cotton farmers were producing higher cotton yield and earning higher per acre gross profit (Rs. 18142.28) relatively to small (Rs. 15232.94) and large (Rs. 8231.349) farm size cotton farmers. There is a need for significant prolong state-based policy measures for provision of adequate and quality based crop inputs, infusion of advanced mechanisation and regulating market mechanism for consistency in prices of crop inputs and outputs. It is essential to increase managerial competencies among farmers through increasing literacy, sufficient access of extension services, familiarity and infusion of advanced mechanisation and adequate access of formal credit through implementing adequate policy measures by concerned authorities of the state.
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