Analysis of Farming Environmental Efficiency Using a DEA Model with Undesirable Outputs

With the idea of sustainable agriculture, farming is not only about the production for food security but also need to consider the impacts for the environment during farming process. Environment issue needs to be considered more for the high-altitude agriculture as they often are located at the reservoir catchment areas which are important for conserving the water resources. There are always conflicts between high-altitude agriculture development and environmental conservation. Because of the extreme climatic events, find out the balance between these two issues becomes an urgent target for the government recently.

Thus, data envelopment analysis (DEA), which can evaluate the decision-making unit with multiple inputs and multiple outputs, was applied to assess economic and environmental factors in this research. The results of farm environmental efficiency score present the land use efficiency of each village under these two conflict issues. It can help government to reveal the un-efficiency area which should be improved first. Furthermore, the slack analysis of DEA reveals that reduction of pollution is the most important issue in the area.