Technical efficiency of shrimp farms in the Mekong Delta, Vietnam

Shrimp production in aquaculture systems has been playing an important economic role in Vietnam in recent years. The area for aquaculture production has been continuously expanding, especially in the provinces of the Mekong Delta. Despite this increase in production, there is some evidence suggesting that many shrimp farms are experiencing significant financial losses. Profitability can, among other things, be affected by the economic efficiency of shrimp farming operations. This chapter examines the effect of technical efficiency on the profitability and financial viability of shrimp farming, based on a sample of intensive and extensive shrimp farms surveyed in the Bae Lieu province, in the Mekong Delta of Vietnam. Technical efficiency was estimated usin~ the stochastic production frontier approach. The results suggest that less technically efficient farms are prone to more substantial financial losses. Experience in shrimp farming and the educational level of farmers are some of the factors that were found to affect technical efficiency.