Abstract: The objective of this paper is to conduct a comprehensive analysis of costs and benefits of paddy production with special reference in externalities. As negative effects, human health problem and human and animal poisoning and as positive social effect flood mitigation, recharge groundwater, purification of water and increasing highland crop(s) yields are evaluated in this study. According to the analysis, considering direct costs and benefits, it is concluded that Paddy farming in Sri Lanka is a profitable farming industry. The total external benefit (TEB) was higher than the total external cost (TEC) in any scheme. In terms of that total social benefits (TSB) was also higher than the total social cost (TSC) in any scheme. These results suggested that the paddy farming process in Sri Lanka released benefits to the society than costs. Therefore, it is indicated that the social required quantity is higher than the current equilibrium quantity. Further, it is concluded that major irrigated paddy farming has plenty of opportunities to implement new projects in order to maximize the benefits of paddy farming.
Keywords: costs benefits analysis, externalities, paddy production, social benefits, social cost.
Title: Impact of External Costs and Benefits of Paddy Farming in Sri Lanka
Author: Nishantha BMN, Semasinghe WM, Kularathne MG, Gunarathna KMLMM
International Journal of Social Science and Humanities Research
ISSN 2348-3156 (Print), ISSN 2348-3164 (online)
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