TECHNICAL EFFICIENCY IN AQUACULTURE INDUSTRY USING DATA ENVELOPMENT ANALYSIS (DEA) WINDOW

Abstract

Marine capture had been traditionally a major source of food supply and income for the Malaysian. This useful function has declined over the last decades because of a continuous pressure on the resource to feed the growing population and a constant increase in demand due to commercialization perspective. As supplement to the marine fsheries its counterpart the aquaculture subsector is becoming more important for the country in terms of the long term food security issue. Aquaculture activities can be planned and the potential species of high demand can be selected for the industry. Hence, the growth and commercialization of this industry begin to gain velocity partly due to the government policy on the future food demand. The objective of this paper is to review and identify regional areas representing by states that technically perform more effciently than the others given the status quo of the existing infrastructures. The infrastructures could be in terms of management ability, suitability of the environment for large scale aquaculture undertakings, local fsh species of high value, availability of natural or man-made water bodies and the potential market facilities and outlets. Evidently, richer states performed better than the poorer states. Johor has the highest score (0.718) and thus the most effcient farm in relation to all the thirteen decision making units (DMUs). Selangor scored 0.612, followed closely by Perak (0.570), Melaka (0.524), Sarawak (0.439), Pulau Pinang (0.430) and Terengganu (0.427). The least effcient DMUs include Kelantan (0.139), Perlis (0.152) and Kedah (0.167). Markets for the advanced states are well developed and necessities for the trade are generally more accessible. Farm operators are better exposed to latest techniques and facilities. This fnding suggests that special attention should be given to poorer states in order to assist aquaculture development. The analyses include the static technical effciency and time series data provide the necessary dynamic features for effciency performance analysis between the states using DEA window.