TECHNICAL CHANGE, FACTOR BIAS, AND INPUT ADJUSTMENTS: PANEL DATA EVIDENCE FROM THE PHILIPPINES

We estimate a random effects stochastic frontier production function to study the impacts of irrigation on factor use on low-income rice farms in the Philippines. Irrigation precipitates a release of labor and an increase in use of fertilizer and pesticides. We find only weak statistical support for time-variant input elasticities. We study the dynamics of input adjustment by measuring the extent to which observed factor levels converge to optimal levels over time.