Estimation of Input Allocation in Multiple Crop Farms in The Growing Economy of Taiwan

The aggregate input data form a time series of cross sections with different farms in Taiwan in each year during 1972-1978 are used to find out how the fanners allocate inputs among crops in the fast growing economy. Dummy variable regression equations based on cropping acreage relation and profit maximization condition are derived to capture the effects of crop, farm size, and tip1e in allocating resources. Empirical results consistently show that farmers are spending more capital and machinery and less hired labor across crops, particularly after 1973 when the government on Taiwan started the sixth economic plan to reduce production costs.