Technical efficiency and yield gap of smallholder wheat producers in Ethiopia: A Stochastic Frontier Analysis

Improving technical efficiency of smallholder farmers is one of the options to increase wheat yield in developing countries. This paper assesses technical efficiency, factors for inefficiency and the yield gap due to technical inefficiency in major wheat producing regions of Ethiopia, where the support to agricultural research for development of strategic crops (SARD-SC) wheat project has been implemented using primary data collected from 946 sample households operating 1616 wheat plots. One-step stochastic frontier approach with a Translog production form was used for econometric analysis. The results show that the mean technical efficiency of the overall sample is 0.769 meaning about 23% technical inefficiency in the system implying that the sample wheat producers are producing at a yield gap of 659 kg/ha. Different input variables contribute for wheat yield. It also reveals that education, oxen ownership, credit, soil fertility, using tractor, and using improved seed (in Tigray) were found to improve technical efficiency of wheat producers either for the overall or for some regions. On the contrary, family labor negatively affects efficiency in Oromia and in overall sample, while using improved seed (in Amhara and SNNP), plot distance and crop rotation (in Oromia) had a negative effect on technical efficiency.  Key words: Technical efficiency, wheat, Ethiopia.