Trade-off analysis of cost and nutrient efficiency of coffee farms in vietnam: A more generalised approach

Abstract

Literature has documented significant trade-offs between economic and environmental performance in many areas of agricultural production. However, while it has focused on the trade-off for technically efficient farms there are differing types of trade-offs that exist for differing types of farms. The present paper addresses these gaps in the literature by proposing a more generalised approach to analysing cost and environmental trade-offs. There is also a lack of research on the nature of the trade-off in coffee farming. This is especially so in Vietnam where there is both significant overuse of nutrients and increasing autonomous adaption through voluntary participation in sustainability certification schemes. The proposed framework is employed to investigate a data set of 679 Vietnamese coffee farms. This study delivers several important findings. First, the proposed approach indicates four distinct groups of farms facing differing types of trade-offs with some farms not facing any trade-offs. Second, empirical results show that the average levels of technical, cost and environmental efficiency are relatively low. Third, sustainability certified farms are found to perform better than non-certified farms although the differences in performance diminish over time. Overall, the empirical results favour a heterogeneous and more integrated policy approach to improving the technical, cost and environmental efficiency of coffee farmers in Vietnam.

Keywords: Coffee production; Cost efficiency; Environmental efficiency; Trade-off; Vietnam.