Frontier analysis of aquaculture farms in the Southern Sector of Ghana

Abstract

This study applies the single-stage modelling stochastic frontier approach to examine technical efficiency and its determination of aquaculture farms and extends the scope of the analysis toexplore interactive effects of farm specific variables on efficiency of production. The data consists of a cross-section of 150 farms collected from 15 districts in the southern of Ghana. Findings demonstrate that expected elasticities of mean output with respect to all input variable considered are positive and significant. Computed return to scale reveals that aquaculture farms in the southern sector of Ghana are characterised by technology with increasing return to scale. The combined effects of operational and farm specific factors are found to influence efficiency. The study further reveals that inclusion of interaction between some exogenous factors and input variables in the inefficiency model are significant in explaining the variation in efficiency. Comparison of mean technical efficiency according to regions did not show any significant variation. Overall mean technical efficiency is estimated to be nearly 80.8%.