Technical Efficiency of Cacao (Theobroma cacao) Farms in Davao City, Philippines
Keywords:
technical efficiency, cacao productivity, data envelopment analysis, ordinary least square regression, PhilippinesAbstract
This paper determined the technical efficiency (TE) and productivity of managed cacao farms in Davao City using the data envelopment analysis. Results of the analysis revealed that the efficiency level’s mean score under noncost model is 0.339 under CRS and 0.472 under VRS. For cost model, mean scores are 0.235 and 0.39 under CRS and VRS assumptions, respectively. Moreover, this paper identified and evaluated the influence of socioeconomic factors on TE using ordinary least square regression. The method identified that the age of farm managers, distance to market, access to credit, and household size were the variables that significantly influenced the inefficiencies under noncost model, while only age of the farm managers, distance to market, and access to credit were the factors that impacted inefficiencies under the noncost model. The means of the computed TE scores for both VRS and CRS, and under non-cost and cost models are all below 50% which highlights that cacao productivity in the city is low. Similarly, the distribution of farms' TE scores showed that more than half of the sampled farms have scores that are less than 25%.
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