Maximizing Profits and Resource Efficiency in Large Cardamom Farming: Insights from Lamjung, Nepal

Abstract

Large cardamom is a highly valued cash crop among the farmers in hilly areas of Nepal. Considering the research gap in optimum resource utilization, and trend for resource use among the producers, the study aimed to assess the resource use efficiency of large cardamom production. The study was conducted among of 91 large cardamom growers in the Lamjung district using a simple random sampling method. Cost-return analysis, Cobb-Douglas production function, and the marginal value product-marginal factor cost (MVP-MFC) approach were used to estimate the profitability and resource use efficiency of large cardamom in the study area. Results revealed the profitable business of large cardamom with a benefit-cost ratio of 1.32. The return to scale value was estimated at 1.103, indicating increasing returns to scale. Labor and saplings were found to have significant effects on the gross income of large cardamom production. Resource use efficiency analysis showed labor, manure, and plant protection chemicals were underutilized, while saplings and fixed resources were overutilized. Aligning the current resource utilization practices with optimal levels of resource utilization, the development of basic infrastructures like irrigation, market information systems, and policy efforts on enhancing the scheme of crop insurance is recommended for profitable large cardamom production.