Labour use Efficiency of Rice farming in Thailand with Emphasis on The Central Plain

Abstract

This study was on labour use in rice farming in Thailand. Thailand is still a predominantly agricultural country and farmers form a large part of its labour force. Although an average of 75 percent of farmers in agriculture are engaged in rice farming, rice output accounted for only 1.8 percent of GDP. The cause of the low contribution of rice production to GDP may be due to the low productivity of labour in rice farming. The research question in this study was what was the efficiency level of labour use in rice farming in Thailand? The main objective of the present study was to investigate the labour input use in rice production by comparing the value of the marginal product of labour with the wage rate. Primary data were collected through the method of stratified sampling from the sample farms for 2002/2003 crop year. The sample comprised 400 farmers from five provinces which had the biggest planted areas in Central Region of Thailand. Cobb-Douglas production function was utilized in the estimation of labour use efficiency.

The result of the study showed that labour use was inefficient in Thai rice farming since VMPL was less than W. The result also indicated that there were decreasing returns to scale in rice production.