Technical Efficiency of Agricultural Farms and Capital-Output Ratio: A Study on Jhansi Division of Uttar Pradesh

Abstract

The increasing use of modern technological inputs like fertilizers, pesticides and manure under the condition of unstable irrigation could be the responsible factors for increasing the agricultural productivity. The mechanical inputs like tractor power, threshers, diesel pumps, electric motors are useful to save time, money and water. These inputs increase the farmer’s income and efficiency. Present study contains the objective to find out the technical efficiency of capital use resources and capital output ratio. In order to find the technical efficiency, the Cobb-Douglas production function method was applied in which Ordinary Least Square (OLS) estimators were converted into the Corrected Ordinary Least Square (COLS) estimators. To examine the technological equality between two districts, Chow Test has been used. The study is on Jhansi, Lalitpur and Jalaun districts of Jhansi division in Uttar Pradesh. Soil type was the main criteria for differentiating the areas for sampling. The selected farm size categories are marginal (up to 2.5 acre land), small (> 2.5 acre land to 5 acre land), and large (> 5 acre land). The study finds that, in selected regions, the maximum percentage of farmers lies in 51% to 60%, 51% to 70%, 71% to 80% and 81% to 90% categories of technical efficiency. But the 61% to 70% and 71% to 80% technical efficiency categories are followed by majority of farm size categories in the selected regions. In Jhansi and Lalitpur districts, marginal and small farmers are used the different amount of inputs but large farmers are used same amount of inputs in two regions. In the case of Jhansi and Jalaun districts and Lalitpur and Jalaun districts, there is no significant difference among the marginal-marginal, small-small and large-large farm size categories in the used amount of different inputs. In selected regions, the individual shares of each input for different categories of farmers are likely to be same to raise the output.