Estimating shadow prices and efficiency analysis of productive inputs and pesticide use of vegetable production

Abstract

This paper analyzes technical efficiency and the value of the marginal product of productive inputs vis-a-vis pesticide use to measure allocative efficiency of pesticide use along productive inputs. We employ the data envelopment analysis framework and marginal cost techniques to estimate technical efficiency and the shadow values of each input. A bootstrap technique is applied to overcome the limitations of DEA and helps to estimate the mean and 95 percent confidence intervals of the estimated quantities. The methods are applied to a sample of vegetable producers in Benin over the period 2009–2010. Results indicated that bias corrected technical efficiency scores are lower than the initial measures and the former estimates are statistically significant. The application results show that vegetable producers are less efficient with respect to pesticide use than other inputs. Also, results suggest that pesticides, land and fertilizers are overused