• MEASURING TECHNICAL EFFICIENCY OF TURMERIC PRODUCTION USING PARAMETRIC STOCHASTIC FRONTIER MODELS

Abstract

Measurement and comparison of Technical Efficiency Score (TES) of Turmeric production plays a major role in the present study. Two stochastic frontier models viz., Cobb-Douglas Normal Half-Normal Stochastic Frontier Model (CDNHNSFM) and Cobb-Douglas Normal Exponential  Stochastic Frontier  Model (CDNESFM) have been used to measure TES. Among the 180 turmeric farms considered, the number of farms having TES above 95% using CDNHNSFM and CDNESFM were 75% and 52% respectively. The higher mean TES was given by CDNESFM (95.79) than CDNHNSFM (94.24). Although CDHNSFM showed higher mean technical efficiency score, CDNESFM, which recorded higher correlation coefficient (0.786) and lower chi-square value (1.1712) between the observed efficiency and expected efficiency is considered as a better model to estimate the technical efficiency for the sample under study.