Estimation of Productivity and Efficiency of Cotton Farmers: A Case Study of District Dera Ghazi Khan

Abstract

This study estimates total technical (TEcrs), pure technical (TEvrs), allocative (AE), and economic (EE) efficiencies of cotton growers in the district Dera Gazi Khan using data envelopment analysis (DEA) technique. The study finds 0.67, 0.94, 0.57, 0.54 and 0.71 average values of the total technical, pure technical, allocative, economic, and scale efficiencies, respectively. The study also tries to investigate the determinants of technical inefficiency of cotton growers and the slacks of inputs. The results indicate that human capital, research and development, and easy access to markets are major determinants of technical efficiency. The output orientation analysis shows that production of cotton can be increased by 6 maunds (240kgs) per acre under present availability of resources. The slack estimates show that 43 percent cost of inputs is used extra and on average Rs.11, 833 per acre can be saved in this account without loss of output. This study suggests that government should make a strategy to improve irrigation system and provide trainings for optimal utilization of inputs, and ban agro-shops that do not have licenses