An Estimation of Technical Efficiency of Poultry Farming in Nepal

Abstract

The commercial poultry is growing rapidly in Nepal which requires that efficient level of output that ensures high levels of productivity and profit is produced. The objective of this study is to estimate the technical efficiency of the poultry farming in Nepal and its distribution spatially across the districts. The study utilizes Cobb-Douglas production function to define the structure of the production model and its error term is assumed to follow exponential distribution. Thereafter, using maximum likelihood estimator, parametric approach to Stochastic Frontier Method is applied to the data obtained from Nepal Commercial Poultry Survey 2015. The study finds technical efficiency of 92 percent suggesting high efficiency. Assuming half-normal distribution in the error term, however, yields technical efficiency of 89 percent. Further disaggregation of technical efficiency by districts shows its homogenous distribution across the districts covered in the study. The study, hence, suggests the possibility to increase its production to the level of potential output by improving technical efficiency. One of the various ways to improve technical efficiency is by ensuring high quality inputs both physical and technical to the poultry farms.

Technical Efficiency Analysis of Layer and Broiler Poultry Farmers in Pakistan

“…These and other activities are required for the success of the chicken business [55]. Consistently, previous studies have reported the same observations for labor in layer poultry farms across countries with economies under development [35,37,56], and thus agree with the results of this study for the layer poultry farms in Pakistan. For broiler farms, the estimated labor results in broiler production were statistically insignificant because the environmental control shed is capital intensive and consists of a self-control system, while at the same time the labor requirement is low for such systems.…”

“…This could be attributed to the fact that larger poultry farms utilize resources more efficiently by applying smaller quantities of resources per unit cost than smaller poultry farms [52]. Previous studies have consistently reported the same finding for the impact of the flock size in layer and broiler production across countries with economies under development [35][36][37]39,51,53]. Most of those studies were conducted in African countries such as Tanzania, Ghana, or Nigeria, while Ullah et al [36] analyzed broiler farms in a selected province (Khyber Pakhtunkhwa) of Pakistan.…”

“…Even more pronounced is the effect in broiler systems; feed-in broiler production's magnitude shows that a 1% increase in feed will increase meat production by 0.42% (Table 4), assuming all other factors remain constant. Previously, most studies found that feed directly affects egg and meat production; this was consistently reported for poultry businesses across countries with economies under development [36,37,56,57]. Iyiola-Tunji [58] conducted detailed studies to confirm that chicken feed is a significant factor in chicken production.…”

“…The existing literature included the production inputs and characteristics as well as institutional factors that affect the technical efficiency of layer and broiler poultry production. The productivity of layer and broiler poultry farms is increased by production inputs such as flock size, feed, and labor [35][36][37]. Water consumption could also increase egg and meat production [32,34,35,38].…”

Effect of Using Saturated and Unsaturated Fats in Broiler Diet in its Performance and Blood Parameters

“…The biological impact and economic efficiency of a feeding system is in fact determined by dietary energy level and it's relation with other nutrients. The possibility to increase its production to the level of potential output by improving technical efficiency which is done by ensuring high quality inputs both physical and technical to the poultry farms (Pradhan et al 2019).…”