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Impact of Land Reform Program on Economic Efficiency and Equity Among Rice Farmers in Nakhon-Nayok Land Reform Area, Thailand
Abstract:
The main objective of the study was to analyze the impact of Land Reform Program on economic efficiency and equity as well as to determine the factors affecting economic efficiency among rice farmers in Nakhon-Nayok Land Reform Area, Thailand.
The study used primary cross-sectional data for crop year 1996/1997 which were collected from 322 rice farmers within and outside Nakhon-Nayok Land Reform Area (NNYLRA) consisting of 12 Tambons of 4 Amphoes namely: Ban Na, Muang Nakhon-Nayok, Pak Phli, and Ongkharak.
The stochastic frontier production function was used to derive the efficiency estimates, while the Lorenz curve and Gini coefficients were used to measure the equity of income distribution among the farmer respondents. The stochastic frontier production function was estimated separately for farmers within and outside NNYLRA and for owner or lessees inside NNYLRA. Results showed that there was no significant difference in technical efficiency between inside and outside farmers.
Between owners and lessees within NNYLRA, average technical efficiency for owners (89.96%) was significantly higher than lessees (72.28%). The average overall allocative efficiency was significantly higher for inside farmers at 88.69 percent compared to outside farmers at 86.61 percent. Within NNYLRA, lessees were found to be significantly more allocatively efficient at 88.32 percent compared with owners at 83.68 percent.
On the average, inside farmers were significantly more economically efficient than outside farmers given indices of 69.83 percent and 65.75 percent, respectively. For owners and lessees with NNYLRA, owners were significantly more economically efficient than lessees (75.14% and 63.22%), respectively.
Among the different factors investigated, educational attainment of outside farmers was found to positively affect economic efficiency. For inside farmers, tenure status had a positive effect on economic efficiency.
Income distribution among farmers inside NNYLRA was more equitable than outside farmers given Gini coefficients of 0.54 and 0.63, respectively. Among inside farmers, income was more equitable for owners than for lessees given Gini coefficients of 0.48 and 0.60, respectively.
The findings of the study showed that the land reform program had positive impacts in terms of both increased efficiency and improved income equity. This implied that the program should expand coverage to spread its benefits to wider groups of beneficiaries. Intensifying support services and other infrastructures would enable farmers to attain maximum output from rice production.