Economic efficiency of rice farms in the Thitson dam irrigation system in Myanmar

This study covered three locations of the irrigation canal in Thitson irrigation network. One hundred fifty rice farmer respondents from three locations were personally interviewed using pre-test questionnaires. The analytical tools used in the study were 1)comparative mean analysis, 2) cost and returns analysis, 3) response function approach using Cobb-Douglas production function, 4) production yield gap studied b y decomposition analysis, 5) income distribution of rice farmers, and 6) economic efficiency analysis, i.e. technical efficiency analysis and allocative efficiency analysis. Results of the cost and returns analysis showed that the head farm group attained the highest net farm income per acre, followed by the tail farm group, and then the middle farm group. All three farm groups gave the best benefit and cost ratio and were economically viable. In the response function approach, the yield levels of rice among the three farm groups were different due to inequality of irrigation water supply. The Chow's test showed that there were structural differences between head and middle, had and tail, and middle and tail farm groups. Using logarithmic decomposition analysis, the observed yield difference between head and middle farm group, head and tail, and, middle and tail farm group might be due to neutral technical effect, availability of irrigation water. The yield differences among three farm groups might be due to the water use efficiency effect and not because of resource used technology effect. The allocative efficiency analysis showed that the fertilizer used in all three farm groups and the pesticide used in the middle farm group were above the optimum level. However, the labor used was below the optimum level in three farm groups. The technical efficiency analysis showed that neutral technical effect led to increase output yield in the farm groups. The study revealed that inequality of the yield distribution and income distribution of the head farm was higher than those of the middle farm and tail farm groups. Inequality of yield distribution of rice farms was due to inequality in the availability of water because of the location of the irrigation canal. Farm size, soil type, and non-farm incomes led to inequality in income level of rice farmer respondents. They were considered using Lorenz curve and Gini coefficient ratio. It was found that yield levels among three farm groups of irrigation canal were different from each other. It might be because of inequality of irrigation water supply. When it was observed for the income level of farmer respondents in three locations of irrigation canal, the result showed that inequality of income distribution among three farm groups. Income distribution was not only upon availability of water supply, but for other factors, farm size, non-farm income, and crop diversification.