Open AccessTechnical Efficiency of Independent Oil Palm Smallholder In Indonesia
Author(s) -
Firna Varina,
Sri Hartoyo,
Nunung Kusnadi,
Amzul Rifin
Publication year - 2021
Publication title -
jurnal ekonomi kuantitatif terapan
Language(s) - English
Resource type - Journals
eISSN - 2303-0186
pISSN - 2301-8968
DOI - 10.24843/jekt.2021.v14.i01.p04
Subject(s) - inefficiency , palm oil , productivity , agricultural economics , production (economics) , production–possibility frontier , agricultural science , stochastic frontier analysis , agriculture , business , technical change , scale (ratio) , economics , economic growth , geography , environmental science , archaeology , microeconomics , cartography , macroeconomics
This study assesses technical efficiency and possible sources of inefficiency of independent smallholder oil palm production in Indonesia with stochastic frontier approach. The result show all the input variables is positively affect the oil palm production and exhibit decreasing returns to scale . The farmers have mean technical efficiency (TE) values 0.6541, however about 53 % farmers have TE above 0.70. Factors such as age of farmer, education, extension services, member of farmer group, land ownership and funding sources have a positive and significant effect on technical efficiency. It is suggested that by improving factors such as input used, education level, technical assistance on farming practice and accessibility to credit facilities should be increase the productivity and technical efficiency of oil palm production. The farmers who have plant over 30 years old, which the TE and productivity are the lowest values, should be thinking about replanting