Technical Efficiency and Production Risk of Maize Production: Evidence from Ghana

Authors:
  • BOBoahen Atta Oppong
    Boahen Atta Oppong
  • EOEdward Ebo Onumah
    Edward Ebo Onumah
  • SASamuel Asuming-Brempong
    Samuel Asuming-Brempong
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Abstract
This paper analyzed maize production efficiency in Ghana due to differences in efficiency. The stochastic frontier model with flexible risk properties is applied with 232 farms from the Brong-Ahafo Region. Findings of the study were the translog model best fits the mean output function, whilst the input variables: seed, herbicide, land, labour and cost of intermediate inputs influenced maize output at decreasing returns to scale. The study also found seed and labor inputs reduced production risk, whilst land and cost of intermediate inputs increased the risk. The average technical efficiency estimate was 62% and the combined farm specific factors explained the variation in technical efficiency. This study concludes, on the average 38% of potential output is lost due to technical inefficiency and production risk in inputs and the use of the best farm practices produce maize efficiently.