Technical efficiency and environmental–technological gaps in wheat production in Kerman province of Iran

This article reports on an analysis of technical efficiency and environment–technology gaps in wheat farming in Iran. A random sample of 676 farmers was selected from the province of Kerman in 2004. In this study, Kerman is divided into five regions based on climatic and geographical conditions. The province is situated in the south-eastern part of Iran and contains substantial variations in climate. The technical efficiency indices are computed using three approaches. First, a standard stochastic production frontier was employed using pooled cross-sectional data. Secondly, regional stochastic frontier production functions were estimated. Lastly, the metafrontier approach was used because production environments and technologies are expected to differ between the five regions. Use of this method enabled technical efficiency scores to be corrected by the coefficient of the environment–technology gap ratio. Estimates of the frontier were obtained assuming a translog functional form.