Rice Subsector Development and Farmer Efficiency in Nepal: Implications for Further Transformation and Food Security

With economic development agricultural systems in the Global South transform from subsistence farming to higher productivity with market integration and increase in rural income and food security. In Nepal, agriculture continues to provide livelihoods for two-thirds of the predominantly rural population, largely at a subsistence-level. Rice is the staple food and covers the largest land area but yields are relatively low, with an annual import bill of USD 300 Million. The study uses data from 310 households from two distinct rice producing areas to assess farmers' rice production systems. It analyses farmers' rice production efficiency using a stochastic frontier production function to suggest how to advance the transformation of Nepal's rice sector. Our study finds that while agriculture related services such as access to inputs, information, markets, irrigation, and finance have generally improved, paddy farmers are only able to achieve 76% of potential output. Small/marginal farms were relatively less efficient than medium and large farms. Women farmers faced unequal access to technologies and have lower productivity than men. Unavailability of labor and capital, land fragmentation, and the lack of consistent access to seed and fertilizers contribute to reduced efficiency. Public and private sector investments are needed to enhance the timely and adequate access to quality seeds, fertilizers, processing facilities, and equipment services. Adopting a market systems approach through cooperative farming, targeted delivery of extension services, and linkages with rice millers can promote inclusive growth and improve rice food security in Nepal.

Effects of Insurance Adoption and Risk Aversion on Agricultural Production and Technical Efficiency: A Panel Analysis for Italian Grape Growers

This article aims to evaluate the effect of insurance on production, technical efficiency, and input use of Italian specialised-quality grape growers. A panel instrumental variable stochastic frontier approach is applied over the years 2008–2017 using data from the Farm Accountancy Data Network. The results show the requirement to correct for the endogeneity that stems from insurance adoption. Insurance has an enhancing effect on production and efficiency and reduces the use of intermediate inputs. It suggests that insurance helps to diminish the risk-averse farmers’ suboptimal input use due to the presence of uncertainty. Crop insurance leads risk-averse farmers to behave as if they were risk neutral and employs the profit-maximising input vector. Therefore, by reducing the risks linked to the uncertainty of outcomes, crop insurance leads grape growers to go in the direction of profit maximisation.

Frontier Technology, Trade, FDI, and TFP in the Electrical and Electronic Industries: Exporting or Processing Trade?

Does “openness” determine “catching-up” of establishments to frontier technology and total factor productivity (TFP) in Malaysia's electrical and electronic (E&E) industries? We contribute to this debate by applying a new measurement of processing trade intensity. Utilizing stochastic frontier analysis and Levinsohn and Pertrin (LP) TFP, we investigate determinants of technical efficiency (TE) and TFP. The results show that processing trade intensity and not export intensity determines TE and TFP for the overall sample and subsample of foreign establishments. In the processing trade subsample, export intensity is negatively related to TE and unrelated to TFP, obtaining an unconventional result that exporters are inefficient and not associated with TFP. The results show that higher foreign ownership shares of establishments are negatively associated with LP TFP.

Trade-offs between economic, environmental and social sustainability on farms using a latent class frontier efficiency model: Evidence for Spanish crop farms

This article studies trade-offs of farms in terms of economic sustainability (proxied here by technical efficiency), environmental sustainability (proxied here by farmers’ commitment towards the environment) and social sustainability (proxied here by farmers’ contribution to on farm well-being and communities’ well-being). We use the latent class stochastic frontier model and create classes based on three separating variables, representing farms’ environmental sustainability and social sustainability. The application to a sample of Spanish crop farms shows that more environmentally sustainable farms are likely to have lower levels of technical efficiency. However, improvements in social concerns, both towards own farm and the larger community, may lead to improved technical efficiency levels. In general, our study provides evidence of trade-offs for farms between economic sustainability and environmental sustainability, but also between environmental sustainability and social sustainability.

Modeling the links between institutional and actual globalization in the countries of the world

The paper is devoted to modeling the links between the institutional and actual level of globalization in the countries of the world. Vector models of error correction, quantile regression, and a stochastic frontier model are considered. As a measure of globalization and its components, the KOF-index of globalization system is used, which allows us to analyze individual globalization processes in the economy, social sphere and politics. According to 2020 data, we determine the dynamic relations between the actual and institutional components of globalization, and the priority of the institutional component for informational and financial globalization is revealed. The example of financial globalization shows the uneven degree of influence of the institutional component on the actual globalization, in particular, its prevailing importance for less globalized countries, indicating the alignment of the degree of internationalization in the global financial system. The degree of effectiveness of the impact of institutional measures, together with the overall level of well-being on the actual financial globalization is analyzed. It is shown that the spread across the countries of the world in the efficiency indicator is almost 70%. Almost 10% of countries have a low efficiency of up to 50%. One third of the countries has average efficiency (50–75%). The share of countries with high efficiency over 75% is about 60%.

Does Agricultural Mechanization Improve the Green Total Factor Productivity of China’s Planting Industry?

Agricultural mechanization is an important factor to improve the green total factor productivity of planting industry, which is the key way to realize the sustainable development and high-quality development of agriculture. Based on the panel data of 30 provinces in China from 2001 to 2019, this paper uses the stochastic frontier analysis method of output oriented distance function to measure the green total factor productivity of China’s planting industry based on net carbon sink, and empirically studies the impact of agricultural mechanization on the green total factor productivity in China’s planting industry. The empirical analysis finds that mechanization can significantly promote the planting green total factor productivity, and this basic conclusion is still robust after using instrumental variables, sub sample regression. Further research found that the path of mechanization on planting green total factor productivity is mainly reflected in technology progress and spatial spillover. The mechanism of operation scale expansion, factor allocation optimization and technical efficiency change is not significant. Given these findings, the paper adds considerable value to the empirical literature and also provides various policy- and practical implications.