Total Factor Productivity of Main and Second Rice Production in Thailand

This paper provides empirical evidence on the total factor productivity (TFP) of the Thai rice sector. It measures growth rates of TFP for the main and second crops and investigates the factors influencing the growth. The study employs pooled cross-section and time-series data covering four regions (North, Northeast, Central and South) over the period 1995-2011. TFPs of the main and second rice crops are measured separately using the Solow-type growth accounting method. The TFP measures are decomposed to identify their determinants using the panel data estimation techniques. The results show that TFP has generally been the main source of growth in rice production, for both main and second crops. The TFP growth, however, has been declining in recent years, particularly of the main crop, threatening long-term growth of the Thai rice industry. The results suggest public investment in research and adoption of high-yielding rice varieties are the key to sustaining long-term growth of both the main and second crops.