Determinants of profit efficiency among peanut farming households in Tra Vinh province, Vietnam

Abstract

This study is aiming to identify profit efficiency and its determinants among peanut farming households in Tra Vinh province, Vietnam, based on the data collected from 182 peanut farming households in three districts of Tra Vinh province. The Cobb-Douglas stochastic frontier profit function incorporating profit inefficiency effects was employed to analyze the data, using the Frontier 4.1. The results revealed that the profit efficiency was ranged between 29.80 to 96.76 percent, an average of 59.06 percent. Significant factors that were found negative affect the peanut farm profit were prices of fertilizer, pesticide, wage rate; whereas, the price of seed and land area (fixed factor) were found negative effect the peanut farm profit. Significant determinants that were found positive effect the profit efficiency of peanut farmers were gender, education attainment, peanut farming experience, farm size, credit access, training, and farmer’s association membership.