Measuring Rice Farmers Efficiency under Deterministic and Uncertainty Situations: An Enhanced Slack-based DEA Model

Agricultural activities including rice farming produces two types of outputs which are known as desirable and undesirable outputs. Therefore, their efficiency should be appropriately evaluated by including these outputs to obtain a reasonable efficiency score and to ensure the farmers are not overly...

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Bibliographic Details
Main Authors: Mohd. Nadhar Khan, Sahubar Ali, Ramli, Razamin, Baten, Md Azizul, Khalid, Ruzelan
Format: Conference or Workshop Item
Language:English
Published: 2021
Subjects:
Online Access:https://repo.uum.edu.my/id/eprint/31050/1/IACE%202472%2001%202021%20040011-1-040011-6.pdf
https://repo.uum.edu.my/id/eprint/31050/
https://doi.org/10.1063/5.0092800
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Summary:Agricultural activities including rice farming produces two types of outputs which are known as desirable and undesirable outputs. Therefore, their efficiency should be appropriately evaluated by including these outputs to obtain a reasonable efficiency score and to ensure the farmers are not overly damaging the environment by their agricultural practices. As a result, this research developed two enhanced slack based DDF DEA models which includes undesirable outputs and data uncertainty to measure efficiency of rice farmers. The first model measures efficiency in the presence of undesirable outputs and non-discretionary inputs. The second model uses interval data approach to represent data uncertainty, and measure interval efficiency. Both models are tested to determine the efficiency of 40 rice farmers in Northern Kedah, Malaysia. Empirical findings showed the developed models are suitable to be applied as it can successfully identify the efficient rice farmers and compute input savings, undesirable output reduction and desirable output augmentation for inefficient rice farmers. From the analysis, it is found that 13 farmers are efficient with an efficiency score of 1 while another 27 farmers are inefficient. Additionally, it is also found that the farmers are better performing in optimistic scenario assumptions compared do pessimistic scenario. The average efficiency values of all farmers for deterministic case is always lower than the optimistic scenario and higher than pessimistic scenario. The results show that the proposed model can be applied when data uncertainty is present in the production environment. The proposed models will enable the decision makers to evaluate the performance of rice farmers and take the necessary actions to improve their performance. The best practices employed by efficient farmers can be identified and implemented among all farmers to further improve the farmers efficiency