Technical Efficiency and Economic Analysis of Tomato Production in Khyber Pakhtunkhwa: A Stochastic Frontier Approach
Technical Efficiency and Economic Analysis of Tomato Production in Khyber Pakhtunkhwa: A Stochastic Frontier Approach
Hazrat Younas1,*, Khuram Nawaz Sadozai1, Amjad Ali1 and Rizwan Ahmad2
ABSTRACT
This research investigated the technical efficiency of tomato production in the Mohamand district of Khyber Pakhtunkhwa, Pakistan. Data was collected from a sample of 119 tomato growers through a well-designed questionnaires and structured interviews. The research employed a multistage sampling technique to acquire primary research data, and the Cobb-Douglas type Stochastic Frontier Production model was utilized with maximum likelihood estimation. The outcomes unveiled a technical efficiency range of 0.73 to 0.76, with an average of 0.75. Notably, variables such as seedling, ploughing, labor, FYM, and pesticide demonstrated statistically significant, while urea, DAP, and irrigation were statistically insignificant. Moreover, the study identified experience as a significant contributor to inefficiency factors affecting farmers’ technical efficiency. The research also shed light on the cost disparities between vertical and linear staking methods, with former incurring a production cost of Rs. 6,99,125/- compared to Rs. 1,84,000/- for the latter. Correspondingly, structured vertical staking led to higher profits, with Rs. 4,25,875/- compared to Rs. 1,92,000/- for linear staking, demonstrating the increased profitability of vertical staking practices. Based on the analysis, the study offers recommendations to foster the growth, promotion, and enhancement of vertically structured tomato production. Notably, labor costs constitute a substantial portion, approximately 50%, of tomato production expenses in the study area. To mitigate these costs, the adaptation of mechanized methods and the utilization of small machinery could hold the potential to reduce the production expenses. Furthermore, the application of a Cobb-Douglas production function regression unveiled a significant negative relationship between age and experience with inefficiency, suggesting the importance of both formal and informal education, such as Farmer Field School (FFS), and providing incentives to retain experience tomato growers in the production process. These measures have the potentials to further augment tomato production in the study area.
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