An Analysis of Technical Efficiency of Vegetables’ Household Production in Mongolia

Abstract

Vegetable production is one important agricultural product in crop production after wheat and potatoes production in Mongolia. Currently, household production dominates in total vegetable production (approximately 80 percent). Thus, the purposes of this paper were to measure technical efficiency and to determine influencing factors inefficiency on vegetable household production in Mongolia by using Stochastic production frontier analysis (SFA). Primary data was collected from randomly selected 260 vegetable households of Mongolia in 2019. The empirical result indicated that the average technical efficiency of the sampled vegetable household was 64.6 % (range between 43.2% and 99.9%) or they lost about 35.4% of the potential output due to technical inefficiency. We found that land and labor are the main influencing input factors of the household’s vegetable production. Also, the result of the technical inefficiency model, variables of age, sex, experience, and credit use obtained a negative relationship with inefficiency. The other variables are family size, education level, land fragmentation index was positively affected by technical inefficiency.