3.4. The Specific Variables used in this Study
3.4.1. Variable Specifications used in Measuring the Efficiency of Farms
The land variable which was estimated in acres was considered as the area covered by edible canna crop. The seed quantity and the price of seed were computed in kilograms per acre and VND/kg. The chemical fertilizer was considered the amount of fertilizer that was used in edible canna production. It was computed in kilograms per acre. Overusing chemical fertilizer could affect to technical, economic, environmental, and energy efficiency of edible canna farms.
The labor variable in man-days, including family and hired, was estimated per acre. In edible canna production, labor was required heavily during the harvest season, which usually lasts for a month. Consequently, the labor variable would have a direct as well as a significant impact on the efficiency of edible canna production in Backan province.
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Besides, to identify the factors influencing the efficiency of edible canna farms, this present study used some explanatory variables, including farm characteristic and socio-economic, as independent variables in regression model. These explanatory variables are specified as follows:
Age of household head: The age of household head was computed in years.
It is hypothesized that the younger farm manager can obtain higher efficient scores than older counterparts. However, in some cases, it is undoubted that the older managers had more years in farming manager which could help their farms avoid risks in production. The positive effect of age on the efficiency scores was showed in previous studies of some authors such as Mathijs and Vranken (2001), Dey et al. (2000) and Piya et al. (2012).
Education of farm manager: The education of the farm managers is calculated by the schooling years. It is predicted that farmers with higher schooling years tend to obtain higher efficiency level, implying that the education variable will affect positively the efficiency of edible canna farms.
This may be that educated farmers have better skills in planning farms, adopting high technology in comparison with non-educated farmers.
Experience of household head: The experience of farmers will be computed by the years in edible canna production. It is hypothesized that farmers with more years in edible canna cultivation will obtain higher efficient scores.
Distance from farms to local market: The distance from farms to the market which is measured in kilometer is expected that farms with further distance could get lower the efficient scores.
Type of household: The type of household is a dummy variable. It is divided into two groups, including poor households, and others. In fact, in agricultural production, poor households tend to obtain lower efficient scores in comparison with other groups due to lacking capital, lacking access to new
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technologies in production. Therefore, based on the correlation between the type of households and the efficiency of edible canna production, policy- designers could give suitable policies and subsidies to improve the efficiency of poor farms.
Credit acess: Accessing credit loans plays a crucial role in agricultural production in the North of Vietnam because it could help poor farmers to diversify agricultural production by undertaking investments and new technology. The role of credit access on the efficiency of agricultural production was shown by previous studies such as Ayaz et al. (2011) and Masuku et al. (2014). In this study, credit access is a dummy variable which is 1 if farmers have access to credit sources, and 0 otherwise.
Family size: Family size is considered an important factor that has a positive impact on the efficiency of farms. It is hypothesized that the large family tends to obtain higher efficient scores compared to other ones. In fact, using family labor in agricultural production is being popular in rural in mountainous regions of Vietnam because it is not easy to apply high technology in the upland area to replace human labor. In edible canna, labor was required heavily during the harvest season, which usually lasts for a month. Therefore, large households would avoid the lack of labor and reduction of hired labor cost from outside. However, the study of Bozoğlu and Ceyhan (2007) indicated that the family size was also found to have a negative effect on farm efficiency.
Thus, the effect of this variable could be positive or negative on the efficiency of farms.
Extension contact: This is a dummy variable which was assumed to be 1 if farmers have a close connection with extension agencies, and 0 otherwise. In fact, extension services play a vital role in agricultural production in Vietnam.
Therefore, this variable is expected to have a positive effect on the efficiency of edible canna farms.
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