Efficiency Analysis and the Effect of Pollution on Shrimp Farms in the Mekong River Delta

Abstract

This article investigates the efficiency of intensive, semi-intensive, and extensive shrimp farming practices as well as the difference between the upstream and downstream efficiency of shrimp farms in the Mekong River Delta (MRD), Vietnam. Our article is the first to compare the efficiency of the 3 shrimp practices and investigate the difference between the efficiency of downstream and upstream farms. The efficiency of shrimp farms is measured using group-frontier and meta-frontier analysis on a sample of 292 farms. The results show that, on average, shrimp farms are inefficient; extensive farms are more efficient than intensive and semi-intensive farms; and, controlling for key socio-economic factors, upstream farms are more efficient than downstream farms, suggesting that pollution from upstream farms may influence shrimp farm efficiency. The results give some direction for improvement and some evidence to shrimp farmers and policymakers in the MRD to take the pollution problem seriously and find solutions for more sustainable development.