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Effects of Rice Farmers' Pest Management Decisions Under Risk on Economic Efficiency in South Sulawesi, Indonesia
Dissertation Abstract:
The study analyzed the mean and the variance of rice yield response from adopting integrated pest management (IPM) and chemical method practices using the Just and Pope’s risk flexible model. Moreover, it also analyzed the factors affecting the rice farmers’ pest management decisions. An attempt was also made to estimate the effect of such decisions on economic efficiency.
The study used primary panel data of rice farmers covering a two-year period (1999-2000). Stratified random sampling using equal allocation method was employed in the selection of 162 samples farmers (81 FFS farmers and 81 non-FFS farmers).
Based on the estimated Just and Pope’s risk flexible model, results showed that seed use would increase mean rice yield and reduce the yield variability. Nitrogen fertilizer application, labor use and IPM method exhibited a positive and significant effect on the mean yield. Herbicide use, on the other hand, negatively and significantly influenced the mean yield. Furthermore, the effect of IPM on the variability of yield was negative and significant. These results suggested that the farmers who practice IPM would get a higher mean yield and are faced with a lower production risk.
This study also found that all the farmers would prefer to adopt chemical method than IPM method. The IPM method adopters were willing to pay higher risk premium and would prefer lower net benefit in order to avoid risk.
Results of the Tobit model showed that adoption of the chemical method, the amount of seeds used, farming experience, educational attainment, and attendance in farmer field school (FFS) significantly influenced the adoption of the IPM method.
On the other hand, the extent of IPM adoption, amount of seeds used, educational attainment, membership in a farmers’ group, and attendance in FFS significantly influenced the adoption of the chemical method.
Findings of the stochastic frontier production function analysis showed that seeds, nitrogen fertilizer, labor use and IPM method statistically and positively affected rice yield. On the other hand, herbicide use showed a negative effect on rice yield.
There was no significant difference in the economic efficiency of FFS farmers and non-FFS farmers, similarly between IPM method and chemical method adopters. The determinant factors of economic efficiency were number of household member, type of irrigation area, membership in a cooperative, family income, farm size, and time.
Based on the results of the study, the following recommendations were suggested: (1) IPM could be promoted to rice farmers especially those with small farms or those without off-farm jobs and well-irrigated area, if it is supported by other programs that can ensure better price of rice yield; and (2) Explore other less costly and more effective means of disseminating information on IPM practices apart from the FFS, which is expensive.