Technical Efficiency of Wheat Production in District Peshawar, Khyber Pakhtunkhwa, Pakistan
Technical Efficiency of Wheat Production in District Peshawar, Khyber Pakhtunkhwa, Pakistan
Shahid Ali, Munir Khan
ABSTRACT
This study was designed to determine technical efficiency of wheat production in district Peshawar of Khyber Pakhtunkhwa, Pakistan. Data from 100 wheat growers were collected through multistage stratified random sampling technique during 2009-10. Stochastic frontier analysis was employed for the estimation of technical efficiency levels and its determinants. Maximum likelihood estimation (MLE) technique was applied to estimate stochastic frontier Cobb-Douglas production function to ascertain the level of technical efficiency. The econometric computer software STATA was applied for the estimation. The estimated value of technical efficiency ranges from 34 to 88 per cent for the farms in the sample, with an average of 62 per cent. This means that if the average farmer in the sample was to achieve the technical efficiency level of its most efficient counterpart, then the average farmer could increase wheat yield by 30 per cent. Similarly the most technically inefficient farmer could enhance wheat yield by 61 per cent. Results further showed that one percent increase in value of land under wheat crop, labour, chemical fertilizer and tractor plough would raise the wheat yield by 0.052, 0.566, 0.130 and 0.438 percent, respectively and were found statistically significant. Farmers’ education was found to be major determinant of technical efficiency/inefficiency. The esti- mated coefficient of farmers’ education was negative and statistically significant, implies that techni- cal inefficiency decreases with the increase in farmers’ education. The use of more labour and tractor plough hours would increase wheat production in the country.The analysis revealed that the technical efficiency increases with the increase in the level of education. Government of Pakistan should focus on formal as well as informal education in the country. Government should also need to provide better educational opportunities to the rural population and extension education to wheat producers.
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