Technical and scale efficiencies of the salinity-induced rice production system in the western coastal region of the Mekong delta, Vietnam

Abstract

Salinity events make Mekong delta’s rice production change significantly. In the salinity-impacted regions, shrimp-rice production is a possibility besides the traditional rice models. This paper aims to assess the economic efficiency of rice-based farms in the Mekong delta in the context of salinity-induced hazards. The random sample is collected from 254 rice-based farms in 28 villages in 24 districts in the western coastal region in the Mekong delta. The method of Data Envelopment Analysis and OLS and Tobit regression estimations are used to measure the economic efficiency and identify the determinants of the technical and scale efficiencies respectively. The findings show that the average overall efficiencies for the technical efficiency and the scale efficiency are 0.642 and 0.848 respectively, implying that substantial inefficiencies occur in farming practices in the Mekong delta. It indicates that there is still potential for improving the economic efficiency of rice-based system. The findings also show that, statistically significantly, the land ownership and the area are the determinants of the economic profit; the irrigation system, saltwater drains, salinity impact, are the determinants of the economic irrigated water use; the land ownership status, the area, and type of seed are the determinants of the technical efficiency; and the gender, age, education level, irrigation system, saltwater drains, area, type of seed, and numbers of fertilizing and weeding are the determinants of the scale efficiency.