Stochastic Frontier and Technical Efficiency of Farms in Irrigated Areas of Pakistan's Punjab

Abid A. Burki, Haq Nawaz Shah

Abstract


This paper presents new evidence on technical efficiency and
its sources by examining the cost behaviour of 387 farms and whole-farm
data from five irrigated districts of Punjab. Fitting translog variable
cost frontier we find that technical inefficiency raises the cost of
average sample farms by 24 percent that could have been saved had the
farms been technically efficient. Our results enable us to conclude that
farm efficiency is positively related to formal schooling of farm
operators, abundance of canal water, and head reaches of mogha, and
negatively to farm size, while the age of farm operators has no effect
on efficiency.

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DOI: https://doi.org/10.30541/v37i3pp.275-291

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