MEASURING RETURNS TO SCALE AMONG VEGETABLE PRODUCERS UNDER TECHNOLOGICAL CHANGE: AN EVIDENCE FROM CHINA

D. Zhang1, A. Saboor2, W. Chen1 and M. Rizwan3*

1College of Public Administration, Huazhong agricultural University, Wuhan, 430070, P.R. China
2Faculty of Social Sciences, Pir Mehr Ali Shah Arid Agriculture University, Rawalpindi, Pakistan
3School of Economics and Management, Yangtze University, Jingzhou, 434023, P.R. China
*Correspondence Author’s Email: rizwaneco@yangtzeu.edu.cn

ABSTRACT

Chinese vegetable industry is rapidly progressing as the vibrant pillar of the rural economy. The imperatives of returns to scale under technological change in the domain of vegetable production are gaining much attention of researchers and policy makers. This research endeavor is aimed to estimate of returns to scale under technological scenario. The return to scale and technological change indexes were calculated by employing survey data collected through primary sources. First, the constant return to scale point was estimated by BCC-DEA model. Then, based on Malmquist-DEA, the total factor productivity of vegetables was calculated for a time series of 2009 to 2016, and the technological progress index is decomposed. Then, the effects of technological progress on the same scale and different scales were determined respectively. The results reveal that most of the vegetable production at present is in the trajectory of small scale cultivation with increasing return to scale. The technical progress index of small-scale planting was better than that of larger scale planting in recent years. Therefore, considerable importance should be put to small-scale growers in vegetable technology popularization. Moreover, the promoting effect of technological progress on production efficiency varies with the difference of acreages. Hence, the possible policy guidance for further improving vegetable production efficiency has been articulated.