Abstract:
Many researchers have depicted that most of the up-country vegetable growers have
failed to capture the technical efficiency due to poor managerial ability of economic
resources. It is an undeniable fact that the majority of the up-country vegetable
farmers are characterized by poor socio-economic status. This paper investigates the
resource use characteristics, profitability and technical efficiency of vegetable farming
in a sample of vegetable farmers selected from 12 Grama Niladhary (G.N) divisions
in Nuwaraeliya District. The experiment sites were randomly selected based on the
list of the GN division in Nuwaraeliya Divisional Secretariat division and the
empirical study was carried out based on a sample of 243 small scale vegetable
farmers. This paper uses both parametric and non-parametric approaches to estimate
the technical efficiencies of vegetable farming at production and marketing stages
under rainfed condition in the up-country of Sri Lanka. The parametric approach was
adopted under stochastic frontier production function with Cobb-Douglas form. The
non-parametric approach in this paper was based on the data envelopment analysis
(DEA) technique in order to estimate the technical efficiency of vegetable farming.
Both parametric and non-parametric approaches have shown that the average
technical efficiency estimates were not at potential level, and there would be a large
room for increasing productivity through improving technical efficiency of vegetable
farming. Under parametric approach, the average technical efficiency estimates at
production stage and marketing stage were 74.62 percent and 67.04 percent,
respectively under parametric and non-parametric approach. Under non-parametric
approach, the average technical efficiency was 70.86 percent and 62.84 percent at
production and marketing stages respectively. To examine the consistency of the
estimates from two approaches under different specifications, the researcher applied independent sample t test, and the results show that the parametric and non-parametric
approaches provide different estimates due to measurement and specification errors.
