Analyzing the Economic Differences in Production Efficiency and Income between Young and Beginning Farmers and Established Farmers in Taiwan
Date Issued
2015
Date
2015
Author(s)
Huang, Yu-Ning
Abstract
Due to the rapid pace in industrial and commercial development, the numbers of new and beginning farmers gradually reduce, the situation led to the average age of agricultural labors in Taiwan continuously increased. Taiwan government in order to improve the agricultural labor aging, make a plenty of policies to attract aspiring young people to participate the agricultural industry. Most literatures focus on the production of new and beginning farmers, but few researches compared productivity and farm income between young beginning farmers and established farmers. To supplement the lack of existing literature, this study discuss and explain the differences between young beginning farmers and established farmers on production efficiency and farm income, and further explain the reasons and factors why make the differences and policies implication. Using a unique farm household survey questionnaire data from Council of Agriculture in Taiwan in 2011 which contains 856 rice farm household. Based on the definition of United States Department of Agriculture, divided into two dataset by agricultural seniority, 77 are new and beginning farmers and 779 are established farmers. The first section, we use stochastic frontier approach to estimate the farmers production and technology efficiency. Then the second section we use Blinder-Oaxaca Decomposition model to find out what factors that make two dataset difference in farm household income and production efficiency. The empirical results indicate that cultivated area is the main positive factor which enhances the production efficiency in two dataset, the fertilizer use does the positive effect on established farmers, and otherwise pesticide makes negative effect production efficiency of new and beginning farmers, other variable cost have a negative effect on rice production efficiency in both dataset. Then the section two Blinder-Oaxaca Decomposition results show that the established farmers’ cultivated area, pesticide, the accept ratio and the amount of subsidies are significantly higher than new and beginning farmers. The difference in production cost, education level and age are the three main factors that cause the difference in production efficiency between two dataset. The cultivated area, age, and the production cost of rice agriculture are the three main factors resulting difference in farm income.
Subjects
New and Beginning farmers
Established Farmers
Stochastic Frontier Model
Blinder-Oaxaca Decomposition model
SDGs
Type
thesis
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