An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia

An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia

Paddy sub-sector is an important agricultural sector and it has become the main contributor of rice for Malaysia. Rice is Malaysian's staple food and the main source of calories. The development of paddy sub-sector manages to guarantee the sustainability of food security for Malaysians. The gov...

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Main Author: Kamarudin, Othman
Format: Thesis
Language:eng
eng
Published: 2016
Subjects:
HB Economic Theory
S Agriculture (General)
Online Access:https://etd.uum.edu.my/6508/1/s93968_01.pdf
https://etd.uum.edu.my/6508/2/s93968_02.pdf
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institution Universiti Utara Malaysia
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language eng
eng
advisor Baharudin, Amir Hussin
topic HB Economic Theory
S Agriculture (General)
spellingShingle HB Economic Theory
S Agriculture (General)
Kamarudin, Othman
An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia
description Paddy sub-sector is an important agricultural sector and it has become the main contributor of rice for Malaysia. Rice is Malaysian's staple food and the main source of calories. The development of paddy sub-sector manages to guarantee the sustainability of food security for Malaysians. The government has undertaken various measures to ensure the productivity of this sector continues to grow. This is to accommodate the demands of society, as well as to reduce imported rice. This study has selected four paddy production regions under Muda Agricultural Development Authority (MADA) as the research locations. This is because MADA is the major rice production in Malaysia. The study is undertaken to investigate factors that influence Malaysia paddy sub-sector, and also to examine the growth of total factor productivity (TFP). In addition, this research also investigates the capital-labow and young-old famers' elasticity of substitution. The study employed time series data from the main seasons of 1996 (1996H1) to 2011 (2011H1). Autoregressive distributed lag (ARDL) approach was employed to determine the longrun relationship between responding variable and regressor. For a model that does not indicate any long-run relationship, the researcher may employ the vector autoregression (VAR) approach. The total factor productivity (TFP) is employed to investigate paddy productivity growth. Present research employs constant elasticity of substitution (CES) production function to determine capital-labour and young-old farmers' elasticity of substitution. Empirical result indicates that each MADA production region has different factors that influence the paddy production. For both main and off seasons the TFP growth is fluctuating below 5 per cent. Empirical estimation also indicates that an average production in off-season has a negative productivity growth (declining productivity levels). The elasticity of substitution between the capital and labour is found inelastic. Meanwhile, the elasticity of substitutions of the young and old farmers is said unitary. From the above findings, this research strongly suggests that the increase in productivity growth is important for paddy sub-sector in Malaysia. The study makes several practical inferences in designing suitable macroeconomic policy and undertaking measures to promote high productivity growth. A few policies are recommended such as to increase research and development (R&D) fund allocation, improve the efficiency of land management and encourage more young people to join paddy sub-sector.
format Thesis
qualification_name Ph.D.
qualification_level Doctorate
author Kamarudin, Othman
author_facet Kamarudin, Othman
author_sort Kamarudin, Othman
title An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia
title_short An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia
title_full An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia
title_fullStr An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia
title_full_unstemmed An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia
title_sort economic analysis of agricultural production function in the muda agricultural development area in kedah, malaysia
granting_institution Universiti Utara Malaysia
granting_department School of Economics, Finance & Banking
publishDate 2016
url https://etd.uum.edu.my/6508/1/s93968_01.pdf
https://etd.uum.edu.my/6508/2/s93968_02.pdf
_version_ 1747828081864736768
spelling my-uum-etd.65082021-04-05T03:10:40Z An economic analysis of agricultural production function in the Muda Agricultural Development Area in Kedah, Malaysia 2016 Kamarudin, Othman Baharudin, Amir Hussin School of Economics, Finance & Banking School of Economics Finance and Banking HB Economic Theory S Agriculture (General) Paddy sub-sector is an important agricultural sector and it has become the main contributor of rice for Malaysia. Rice is Malaysian's staple food and the main source of calories. The development of paddy sub-sector manages to guarantee the sustainability of food security for Malaysians. The government has undertaken various measures to ensure the productivity of this sector continues to grow. This is to accommodate the demands of society, as well as to reduce imported rice. This study has selected four paddy production regions under Muda Agricultural Development Authority (MADA) as the research locations. This is because MADA is the major rice production in Malaysia. The study is undertaken to investigate factors that influence Malaysia paddy sub-sector, and also to examine the growth of total factor productivity (TFP). In addition, this research also investigates the capital-labow and young-old famers' elasticity of substitution. The study employed time series data from the main seasons of 1996 (1996H1) to 2011 (2011H1). Autoregressive distributed lag (ARDL) approach was employed to determine the longrun relationship between responding variable and regressor. For a model that does not indicate any long-run relationship, the researcher may employ the vector autoregression (VAR) approach. The total factor productivity (TFP) is employed to investigate paddy productivity growth. Present research employs constant elasticity of substitution (CES) production function to determine capital-labour and young-old farmers' elasticity of substitution. Empirical result indicates that each MADA production region has different factors that influence the paddy production. For both main and off seasons the TFP growth is fluctuating below 5 per cent. Empirical estimation also indicates that an average production in off-season has a negative productivity growth (declining productivity levels). The elasticity of substitution between the capital and labour is found inelastic. Meanwhile, the elasticity of substitutions of the young and old farmers is said unitary. From the above findings, this research strongly suggests that the increase in productivity growth is important for paddy sub-sector in Malaysia. The study makes several practical inferences in designing suitable macroeconomic policy and undertaking measures to promote high productivity growth. A few policies are recommended such as to increase research and development (R&D) fund allocation, improve the efficiency of land management and encourage more young people to join paddy sub-sector. 2016 Thesis https://etd.uum.edu.my/6508/ https://etd.uum.edu.my/6508/1/s93968_01.pdf text eng public https://etd.uum.edu.my/6508/2/s93968_02.pdf text eng public Ph.D. doctoral Universiti Utara Malaysia Abdullah, A. M. (2007). Malaysian Paddy and Rice Industry: Policy Implementation and Directions. In Fatimah, M. A., Nik Mustapha, R. A,, Abdullah, A. M., & Bisant Kaur, (Eds), 50 years of Malaysian Agriculture: Transformational Issues, Challenges and Direction, UPM Press, Serdang, pp. 281-308. Abdullah, N. (2000). The Effects of Price-support Programme on Farm Tenancy Patterns and Farm Profitability: Some Evidence from Malaysia. The Pakistan Development Review, 39(1), 51-72. Abdullah, N. (2002). Measurement Of Technological Change Biases And Factor Substitutions For Malaysian Rice Farming. 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