Analysis of Technical Efficiency and Varietal Differences in Pistachio Production in Iran Using a Meta-Frontier Analysis

This paper reports on an analysis of technical efficiency and varietal differences in pistachio production in Iran. A random sample of 475 farmers was selected from the province of Kerman in 2003 and 2004. In this study, farmers are classified into three groups according to the variety of tree they planted. The three main varieties of pistachio trees planted are Kalleh- Ghuchi, Fandoghi and Akbari. The technical efficiency indices are computed using three approaches. First, a standard stochastic production frontier was employed using pooled data. Secondly, stochastic frontier production functions were estimated for each variety (separately). Lastly, the meta-frontier approach was used because production varieties and technologies are expected to differ between the three varieties. Use of this method enabled technical efficiency scores to be corrected by the coefficient of the variety-technology gap ratio (VTGR). Estimates of the frontier were obtained assuming a translog functional form. Results indicate that the mean values of technical efficiency in 2003 and 2004 for the pooled frontier, variety group frontiers and meta-frontier across all data are 54 per cent, 55 per cent and 62 per cent, respectively. The mean value of VTGR in 2003 and 2004 varies from 0.58 for the Kalleh-Ghuchi variety to 0.68 for the Fandoghi variety. These results show the importance of taking into account the differences in frontiers imposed by different tree varieties.