Does Technological Linkage in Contract Farming Increase Farm Productivity and Efficiency? The Case of Hybrid Paddy Seed Cultivation in Undivided Andhra Pradesh^§

Increasing interest for knowing whether technological and input linkages in contract farming increase the farm productivity and efficiency, this paper provides an empirical evidence by undertaking a case study of hybrid paddy seed cultivation through contract farming in undivided Andhra Pradesh. Heckman sample selection model has been used to estimate the productivity differences between contract and non-contract farmers and stochastic production frontier has been used to measure the technical efficiency. The results have indicated that contract farmers could achieve higher productivity and more efficiency by growing contract crop compared to non-contract crop. However, non-contract farmers could achieve higher productivity and more efficiency in growing non-contract crop compared to contract farmers. The results have pointed out many avenues for future research; these include the autonomy of farmer in contract farming, technology spill-over effect, and impact of modern technology in contract farming on farmer's traditional knowledge and local environment.