How Efficient are Our Paddy Farmers? An Economic Analysis of Technical Efficiency and Changing Cost Structure in Paddy Production Across Indian States
Sulakshana Rao C. and R. Balasubramanian
The paper attempts to estimate the plot level technical efficiency of paddy farmers across the major paddy producing states in India using stochastic frontier production function. The technical efficiency was estimated for the all major rice-growing states for two different time periods (2003-04, 2012-13) using data from the Comprehensive Scheme on Cost of Cultivation of Principal Crops. Rice production with more than 80 per cent technical efficiency was observed in Odisha, West Bengal and Tamil Nadu. It was observed that the realized output could be increased by more than 10 per cent by enhancing the efficiency without any additional inputs. Agriculturally advanced states showed a declining trend in the yield implying an increasing pressure on rice production ecosystems due to continuous, intensive cultivation practices. The decadal changes in cost of cultivation of rice at constant prices (TE 2004-05 and TE 2012-13) were computed across the states and it varied from a maximum increase of 27.51 per cent in West Bengal to a minimum of 10.30 per cent in Punjab.