Technical Efficiency Assessment of Dairy Farm in the South-west Region of Bangladesh

Abstract

The paper concentrates on technical efficiency assessment of dairy farms in the south-west region of Bangladesh. Stochastic frontier approach is used in the paper. 70 dairy farms are considered as sample.  The data reveals that number of labour and the quantity of food are statistically significant at 1 percent level of significance. In addition, the data also manifests that numerous farm specific characteristics i.e. farm size, farmer’s age and amount of credit are statistically significant at 1 percent, 10 percent and 10 percent level of significant respectively. The range of technical efficiency for the farms varies from 26 percent to 95 percent. The mean technical efficiency is 68 percent for the dairy farms of the south-west region. This implies that an average output of milk production falls 32 percent short of maximum possible level. Hence, there is huge scope of improvement in dairy sector. Therefore, to improve the farm productivity proper training for the farmer and medical treatment facility should be given.

Keywords: Dairy farm, Cobb-Douglas production function, Technical efficiency, South-west region.

DOI: 10.7176/EJBM/11-10-04

Publication date: April 30^th 2019