Impact of land fragmentation and resource ownership on productivity and efficiency: The case of rice producers in Bangladesh

The paper analyzes the impact of land fragmentation and ownership of resources on productivity and technical efficiency in rice production in Bangladesh using farm level survey data. Results reveal that land fragmentation has a significant detrimental effect on productivity and efficiency as expected. The elasticity estimates of land fragmentation reveal that a 1% increase in land fragmentation reduces rice output by 0.05% and efficiency by 0.03%. On the other hand, ownership of key resources (land, family labour, and draft animals) significantly increases efficiency. The mean elasticity estimates reveal that a 1% increase in family labour and owned draft animal improve technical efficiency by 0.04% and 0.03%, respectively. Also, a 1% increase in the adoption of modern technology improves efficiency by 0.04%. The mean technical efficiency in rice production is estimated at 0.91 indicating little scope to improve rice production per se using existing varieties. Policy implications include addressing structural causes of land fragmentation (e.g., law of inheritance and political economy of agrarian structure), building of physical capital (e.g., land and livestock resources), improvements in extension services and adoption of modern rice technology. (C) 2008 Elsevier Ltd. All rights reserved.