Damianus Adar, Arief Daryanto, Kuntjoro, and Nunung Kusnadi

Abstract:

This paper investigates farm level technical efficiency differences of production and its determinants in a sample of 360 high- and low-land mandarin keprok SoE producing farms in 12 villages in six sub districts of South Central Timor district in west Timor, Indonesia. This study used a Translog functional form using technical inefficiency effect model of stochastic production function approach, simultaneously applied to cross section data. Results indicate that, overall, technical efficiency of production in the samples of mandarin keprok SoE producing farms investigated in both zones ranges from a minimum of 17% to a maximum of 92% with an average technical efficiency estimate of 66%. This suggests that mandarin keprok SoE farmers may increase their production by as much as 34% through more efficient use of production inputs. In addition, mean technical efficiency in the highland area, 67%, is greater than lowland area, 61%. Farm size of < 1 ha indicates lower technical efficiency level than bigger farm size of ≥ 1 ha, both in high- and low-land producing farms. Furthermore, overall, estimated coefficients in the technical inefficiency model indicate positive effect on the technical efficiency of experience, farmer age, selling method and the farmer group. While education, contacted with agricultural field officers and other sources of income give a negative effects on technical efficiency. All determinants of efficiency level in highland producing farms give positive effects, except for education factor.

Keywords: Technical efficiency, stochastic frontier production function, mandarin keprok SoE producing farms, high- and low-land areas, West Timor

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