Abstract:
The tea smallholding sector is the leader in national tea
production in Sri Lanka. However, it is believed that
increasing profit is very difficult without increasing
costly inputs, considering the high cost of production.
This paper investigates the technical efficiency of
smallholder tea farmers (STFs) in Sri Lanka by
employing stochastic production frontier using a sample
of 120 STFs. The results showed that the average
technical efficiency of selected STFs is 78.44 per cent.
This indicates that output can be further increased by
21.56 per cent without increasing the level of input.
Gender and access to quality extension services were
identified as the variables that have the greatest impact
on technical efficiency. The results further showed the
labour is the most important factor for tea production.
