Abstract
Recently, paddy farmers in Sri Lanka have experienced diminished production and profit. Improving profitability through increased efficiency in resource usage is a way to maintain paddy farming's long-term sustainability as an important source of economic livelihood for rural households. Therefore, the objective of this research was to evaluate the technical efficiency of small-scale rice farms in Sri Lanka using the stochastic production frontier methodology and to identify factors which contribute to improved efficiency. Factors such as farm size, inorganic fertilizer, and method of planting showed significant effect on paddy yield. The overall mean technical efficiency of paddy farms was 0.74 (ranging from 0.34 to 0.95). Farmer's age, education, experience, and extension assistance received were the major factors influencing technical inefficiency. Factors such as education and extension assistance were identified as mechanisms to improve the technical efficiency of paddy farms thereby increasing revenues from farming.
