Abstract/Summary

The overarching objective of this research is to provide insight into how Thailand can sustainably intensify its rice production. To achieve this aim, this research develops an innovative approach for measuring agricultural environmental efficiency, which is called “the directional nutrient surplus efficiency measure”, which takes place within the theoretical context of directional distance function. Thus, the study determines optimal rice output and the combinations of inputs used for rice production that will minimise the nutrient surplus. This is done using cross-sectional secondary data from 1,112 rice farms which were divided into 9 categories for observation for the crop year 2008/09. In order to estimate the technical efficiency of the 9 observed groups of Thai rice farmers, the directional distance function was used, with different directions of improvement towards the production possibility frontier. The results indicate that measuring technical efficiency is robust in the context of the model choice for the technically efficient farms, implying that different TE measurements (i.e. different directional vectors) do not change the status of the technically efficient farms in the observation. 70%, 26%, 55%, 55%, 64%, 40%, 46%, 78%, and 34% of the total observations of jasmine rice North, jasmine rice Northeast, jasmine rice Central, non-jasmine rice North, non-jasmine rice Northeast, non-jasmine rice Central, nonjasmine rice South, glutinous rice North, and glutinous rice Northeast, respectively, produce on the PPF. The results also indicate that Thai rice farmers have average TE scores ranging from 84.1% to 99%, depending on which directional vector is chosen. Directional nutrient surplus efficiency measures with the directional vectors towards the nitrogen and phosphorus surplus minimum points were applied to measure the nitrogen and phosphorus surplus efficiency of Thai rice farming systems. The results indicate that the amount of NS discharged into the environment by the observed Thai rice farmers averages from 20.1 to 50.7 kg/ha, and the PS discharged into the environment averages from 11.0 to 28.7 kg/ha. The best practice farms of the 9 observed groups, according to this study, can earn higher profits by using fewer inputs, especially inputs detrimental to the environment like nitrogen and phosphorus fertilisers, than the average farms in their respective groups; this also results in lower amounts of NS and PS being discharged into the environment, compared to the average farms in their respective groups. Thus, the environmental problems caused by Thai rice farming systems can be solved by adopting the methods of the best practice farms, and imposing policies for environmental taxation and site-specific soil nutrients testing.