This study analyses the factors affecting production efficiency on small and medium coffee producers in North Central region of Nicaragua. To carry out this analysis, a non parametric approach DEA is used. It also has a second stage Tobit Regression analysis to measure efficiency factors of production throughout the farms specific attributes and socio-economic variables. This study uses primary data research through the collection of 140 surveys to farms during the 2011-2012 crop years. The results obtained show that TE for small medium and all farms together is 0.52, 0.70 and 0.61 respectively. Medium farms over pass small ones by 18% more of TE. The analysis also reveals that the educational level of the farmer, number of family member living in the farm, access to credit and diversification are the major socioeconomic variables influencing the farmers’ technical efficiency. Finally, the findings prove that further productivity gains linked to the improvement of technical efficiency and implication of new government policies may allow Nicaraguan coffee production to increase.
This study analyses the factors affecting production efficiency on small and medium coffee producers in North Central region of Nicaragua. To carry out this analysis, a non parametric approach DEA is used. It also has a second stage Tobit Regression analysis to measure efficiency factors of production throughout the farms specific attributes and socio-economic variables. This study uses primary data research through the collection of 140 surveys to farms during the 2011-2012 crop years. The results obtained show that TE for small medium and all farms together is 0.52, 0.70 and 0.61 respectively. Medium farms over pass small ones by 18% more of TE. The analysis also reveals that the educational level of the farmer, number of family member living in the farm, access to credit and diversification are the major socioeconomic variables influencing the farmers’ technical efficiency. Finally, the findings prove that further productivity gains linked to the improvement of technical efficiency and implication of new government policies may allow Nicaraguan coffee production to increase.