Estimation of Potato Farming Efficiency Using Data Envelopment Analysis

Abstract

Nowadays to satisfy demands for growing population in developing country increasing production efficiency of agricultural output become a growing concern. In Bangladesh, Government encourages farmers to increase potato production to reduce pressure on rice and export to earn foreign currency. Increasing potato production requires more efficient use of farmers' resources with current technology. This Study uses DEA to examine economic, technical, and allocative efficiencies and applies Tobit model to detect the affecting factors of potato farming efficiency from purposively selected four districts. DEA reveals substantial inefficiencies in Potato production. Very few farms are found highly efficient. Variability of potato production are jointly determined by socio-economic and infrastructure factors. Comparison among three efficiencies shows that farms are more technically efficient. Therefore, Government needs to pay attention to improving allocative and economic efficiency.