Analysis of the effects of distortions on paddy rice production in Côte d'Ivoire

Abstract

Market failure and ineffective public policies pervade in less-developed countries. This situation leads to distortions on output. The current study tries to capture distortions’ effects on paddy rice production in the case of Côte d’Ivoire using a generalized indirect production function with shadow price and shadow cost. Through a sample of 193 rice growers, the results show that farmers under-use fertilizers by 10% and over-use the hired-labor by 18%. The whole output loss is found to be on the range of 45%.

Key words: Generalized indirect production function, Shadow price, Shadow cost, distortions, Côte d’Ivoire