A Study on Farm Sizes and Efficiency of Rice Big Tenant Farmers-Application of Stochastic Frontier Approach

• Main Authors: Chia-Hui Liao, 廖珈暉
• Other Authors: Biing-Wen Huang
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/3ypwdx

碩士 === 國立中興大學 === 應用經濟學系所 === 104 === The rice big tenant farmers have been increasing farming acreage since Council of Agriculture, Executive Yuan proposed “Small Landlords and Big Tenants” in 2009. However, does that actually have better cost and profit efficiency with larger farming acreage? On the other hand, what are the optimal farm size with cost or profit efficiency? This paper follows Farrell(1957) the “production frontier” viewpoint and considers the stochastic factors such as weather and natural environment. Then, we build stochastic frontier translog cost function and profit function to compare the cost and profit efficiency between the first period and the second period in 2013. We also analyze the cost and profit efficiency with different farm sizes, and find out the optimal farm sizes of the cost and profit efficiency. Our empirical results reveal that the cost and profit efficiency in the first period are better than in the second period. We also find that the environment factor is the main reasons to create the inefficient phenomenon in the first period, and the technology factor is the main reasons in second period. Furthermore, the empirical results show that the tenants who cultivate more than 20 hectares can reach the optimal farm sizes with the cost efficiency. On the other hand, we have the same conclusion while we discuss the relationship between cost efficiency and farm sizes. In this paper, we propose two suggestions. First, the government should clearly legislate to compensate the loss when the natural disasters occur. Second, the government can propose “rental subsidy” policies to encourage rice tenants to rent more farms and improve their cost efficiencies.