International Journal of Business and Social Science

ISSN 2219-1933 (Print), 2219-6021 (Online) DOI: 10.30845/ijbss

The Impact of Resource Intensification on the Resource Use Efficiency among Dairy Farms: Gross Margin and Production Function Approaches
Torki Mejhim Al-fawwaz, Ali AL-Sharafat, Moatasem Al-Masad

The impact of agricultural resource intensification on the resource use efficiency is not fully understood in most of the developing countries. No enough empirical evidences are available to address this impact. This study aimed at providing an empirical evidence of the effect of resource use intensification on the resource use efficiency of dairy farms in Jordan. Both marginal analysis and production function procedures were followed in this study. The marginal procedure was based on the comparison of the Marginal Value Product of the variable inputs (MVP) with their Marginal Cost (MFC) to estimate the efficiency of the used resources in two dairy production systems; intensive and semi-intensive systems. The production function procedure conducted by developing of multiple regression models for the used inputs in the investigated production systems. A structured pre-tested questionnaire was used for data collection. Two hundred fifteen dairy producers were interviewed. The results of the study revealed that there is no need for any modifications in the rate of use of all resources in the intensive dairy production system since all resources are ideally utilized and farmers are maximizing profits. In the semi-intensive dairy production system increasing the number of dairy cows and cost of veterinary services, drugs, and vaccines and decreasing the quantity of labor and cost of feed will increase farmers profits. The overall conclusion is that resource use intensification will end in improving its use efficiency and profit maximization of dairy farms. Encouraging farmers to shift to intensive production systems by providing credit facilities, subsidized inputs and specialized extension services will aid in this regard.

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