Analysis of profitability and effect of factors of production in paddy cultivation in Morang, Nepal

Abstract

Paddy is one of the principal food crops in Nepal. Most of the Nepalese farmers are currently utilizing inputs in an unscientific manner due to lack of information about the most efficient use of resources, resulting in low yield and efficiency. This study was conducted for the analysis of profitability and effect of factors of production in paddy cultivation in Morang district of Nepal. A sample of 120 paddy growers were selected from 4350 paddy farmers registered in PMAMP, Rice zone, Morang using Simple Random Sampling Technique. Primary and secondary data were collected using face-to-face interview schedule and reviewing different articles and journals. Data collected were entered, tabulated and analyzed using MS-Excel and Statistical Package for the Social Sciences (SPSS). Descriptive statistics such as mean, frequency, and percentage were used to study farmer's socio-economic characteristics while inferential statistics was used in analysing the influence of production factors using Cobb-Douglas production function. The total cost of paddy production, gross income, and net income per hectare was found to be Rs.70,082.65, Rs.1,11,171.23 and Rs.41,088.57 respectively whereas productivity of paddy was found to be 4.32 MT/ha. The BC ratio 1.66 indicates that it is a profitable enterprise. The labor cost contributed most to the variable cost with 45.48%. Moreover, independent variables such as seed, labor and mechanical power contributed significantly to the yield. Therefore, paddy farming should be encouraged among farmers by increasing the availability and affordability of inputs while also improving food security.