Environmental Efficiency and Economic Losses of Vietnamese Tea Production: Implications for Cost Savings and Environmental Protection

Chemical fertilizer and pesticide are widely used by tea farmers in Vietnam to increase yield and combat risk associated with pests and diseases. However, their indiscriminate use can lead to various environmental problems. This study utilizes stochastic frontier analysis to measure the environmental efficiency of Vietnamese tea farms, taking explicitly into account the economic effects of chemical fertilizer and pesticide on tea production. We find that these environmentally detrimental inputs are overused in the farms, and there is considerable scope for decreasing their application with the current technology. Agricultural policies considering both the production and the environmental efficiency of chemical fertilizer and pesticide may assist tea farmers to save production costs and conserve the environment.