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Total Factor Energy Productivity and Efficiency Changes of the Gher (prawn-carp-rice) Farming System in Bangladesh: a Stochastic Input Distance Function Approach

Sanzidur Rahman*
School of Geography, Earth and Environmental Sciences, University of Plymouth, Drake Circus, Plymouth PL4 8AA, UK

Basanta Kumar Barmon
Department of Economics, East West University, A/2, Jahurul Islam City, Aftabnagar, Dhaka 1212, Bangladesh

Abstract/ Executive Summary:

This paper measures energy performance, Total Factor Energy Productivity (TFEP), technical change (TC) and energy efficiency change (EEC) of the gher (prawn-carp-rice)farming system using a unique panel data of 90 farmers covering a 14 year period (2002–2015)from southwest Bangladesh by employing a stochastic input distance function approach. Results reveal that all inputs contribute significantly to the energy productivity of the gher farming system with male labor energy input being the major contributor followed by energy from machineries, seeds and chemicals. The energy performance of the High Yielding Variety (HYV) rice enterprise is highly efficient whereas the prawn enterprise is highly energy inefficient. Furthermore, the energy performance of the HYV rice enterprise improved significantly over time. Significant competition exists between HYV rice and prawn enterprises as well as prawn and carp enterprises. Experience and education significantly improve energy efficiency whereas gher area and household size significantly reduces it.TFEP grew at the rate of 2.56% per annum (p.a.)solely powered by technical progress at the rate of 2.57% p.a. Gher system can be sustained in the long-run driven by technical progress and improvements in energy productivity of the HYV rice enterprise. Policy implications include investments in R&D and education targeted at the gher farmers.

Keywords: Total Factor Energy Productivity; Technical change; Energy efficiency change; Gher farming system; Panel data

Location:

Start Date:

End Date:

Program Area: Farming System

Commodity: Cropping System

Objectives:

The results will also be useful for policymakers and relevant stakeholders aimed at enhancing food production and increasing income of the farmers without compromising sustainability of the system.

Methodology:

Data and the Study Area: This study is based on a unique set of farm-level panel data covering a 14-year period (2002–2015)collected from Bilpabla village, located in southwest Bangladesh. The village was purposively selected because farmers in this village have been engaged in the gher farming system for a long time. Also, Bilpabla village can be considered a typical village of the Dumuria sub-district of Khulna District. The first year of data collection took place in 2002. Bilpabla village has 410 farm households of which 90 farmers (22% of the total population), whose major income source is gher farming, were selected using a simple random sampling procedure for the survey. The first round of data was collected over a six-month period (i.e., November 2001–April 2002). Since then, the same set of 90 farmers was surveyed every year until 2015, therefore providing a unique cohort of 90 farmers over a 14-year period bringing the total sample size to 1260 observations. The dataset thus forms a strongly balanced panel of 90 farmers covering a 14-year period and provides a unique opportunity to examine the dynamics of productivity and efficiency changes of the gher farming system at the producer level. The questionnaire used in the survey contained three sections. Section A contained information on socioeconomic conditions, (e.g., experience/age of the farmer, education, family size, farm size etc.). Section B covered detailed information on the quantity and value of inputs and outputs of HYV rice production (e.g., seedlings, inorganic fertilizers organic fertilizer, family and hired male and female labor, irrigation, pesticides, HYV rice output and straw as by-product). Section C covered detailed information on the quantity and value of inputs and outputs of prawn-carp production (e.g., fingerlings, feeds, family and hired male and female labor, chemicals and prawn and carp outputs). Overall, 20 questions were used in a tabular format to collect full information on the gher farming system. The questionnaire was pretested prior to the survey and locally recruited enumerators were used for data collection. 2.2. Analytical Framework: The analytical framework includes :(a) computing basic partial measures of energy performance, such as, energy productivity, energy use efficiency and net energy balance; and (b) an application of the stochastic input-distance function approach to identify drivers of energy productivity and efficiency as well as to compute indices of TFEP, TC and EEC. 2.2.1. Basic Energy Measures of Input-Output Ratios Common partial measures of energy input and output were computed for each enterprise of the gher farming system for each year to examine the movement in these measures over time. 2.2.2. The Stochastic Input Distance Function The gher farming system represents a multi-output, multi-input production technology, which can be analyzed with a distance function using an either parametric or non-parametric approach. We have specifically adopted the stochastic input-distance function approach because it does not require the assumption of separability of inputs and outputs, can provide an econometric estimation of the drivers of energy productivity and efficiency and can be used to compute TFEP, TC and EEC indices over time.

Source of Information: Energies 2018,11, 3482; www.mdpi.com/journal/energies

Article Link (Online Journal): doi:10.3390/en11123482

Funding Source:

Budget:

Total Budget (Tk.) :

Achievement/Findings:

The principal aims of this study were to evaluate trends in basic energy performance measures over time and to compute TFEP, TC and EEC indices of the gher farming system, which is operating in the coastal regions of Bangladesh, by utilizing a unique farm-level panel data of a cohort of 90 farmers covering a 14-year period (2002–2015). The purpose is to judge whether the gher farming system is sustainable over time when evaluated in terms of energy use. Results reveal that although the prawn-carp enterprise is highly inefficient in energy use, the high-energy efficient HYV rice enterprise offset the negative net energy balance of the former and makes the gher farming system as a whole energy efficient. However, substantial scope remains for improving the technical energy efficiency of gher farmers. Experience and education are the significant drivers of energy efficiency. The TFEP grew at the rate of 2.56% p.a. mainly driven by TC at the rate of 2.57% p.a. with a negligible decline in EEC. The key conclusion that emerges from this study is that the gher farming system demonstrated significant productivity growth driven by technical progress over time and, therefore, it is sustainable in the long-run when evaluated in terms of energy use. The farmers are becoming more prudent in the use of their input levels, particularly in the HYV rice enterprise, which had a dominant influence in improving net energy balance, thereby, leading to significantly improved performance of the gher farming system as a whole over time. Also significant increase in energy output of the HYV rice enterprise over time further contributed to overall sustainability of the gher farming system. An estimated 61% of total energy inputs are renewable, which is encouraging. The following policy implications can be drawn from this study. First, a major thrust should be geared towards maintaining and/or improving the productivity of the HYV rice enterprise. This can be achieved through R&D investment. The Bangladesh Rice Research Institute (BRRI) has a major role to play in this area to develop strains of HYV rice that are particularly suited to gher farming system. Second, measures should be undertaken to improve the performance of the prawn enterprise through developing feed ingredients and production technologies. This is because the prawn enterprise seem to be stagnant in energy performance over time. The Bangladesh Fisheries Research Institute (BFRI)has an important role to play in this regard. Third, investment in education targeted at the gher farmers will significantly improve energy efficiency. Effective implementation of these policy measures will boost the sector and unable to sustain it in the long-run.

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