Journal of Agricultural Economics and Development Vol. 5(2), pp. 033-044, February 2016 ISSN 2327-3151 ©2016 Academe Research Journals

Full Length Research Paper

Assessment of the premium on rice yield and rice income from adoption of organic rice farming for Cambodian farmers: An application of endogenous switching regression

Rada Khoy¹, Teruaki Nanseki²* and Yosuke Chomei²

¹Graduate School of Bioresource and Bioenvironmental Sciences, Kyushu University, Japan.

²Faculty of Agriculture, Kyushu University, Japan.

*Corresponding author. E-mail: nanseki@agr.kyushu-u.ac.jp. Tel/Fax: +81-92-642-2970.

Accepted 3 January, 2016

Abstract

Cambodia has the potential to engage in organic rice farming since many rice farmers never fully embraced the excessive use of external farm input. Hence, this article intended to identify factors influencing farmers’ decision in adoption of organic rice farming as well as to assess the premium of rice yield and rice income of farmers from adopting organic rice. Endogenous switching regression was employed to control for farmers’ observable and unobservable characteristics. Data were collected through face-to-face interview using structured questionnaire. Out of 221 respondents, 84 farmers were organic farmers, and 137 farmers were randomly selected conventional farmers. Result indicated that variables such as: age, education, selling, other farm activities, number of cows, and owned tractor were positively associated with adoption of organic rice farming, whereas house size variable was negatively correlated with the adoption decision. The results showed that all farmers could obtain higher rice yield and rice income if they adopt organic farming. Additionally, the estimations of farmers’ selection bias for rice yield and rice income suggested that farmers adopt a new farming system based on their relative advantage. Based on this study, farmers were encouraged to adopt organic rice farming to obtain the yield and income premium.

Key words: Organic rice farming, conventional rice farming, endogenous switching regression, selection bias, rice income, Cambodia.