Antonio Alvarez

Diseconomies of Size with Fixed Managerial Ability

Managerial ability has important implications for farm growth. In this article we first show in a production model that increasing output with a fixed level of managerial ability can lead to a decrease in profits. Next, we discuss the effect that managerial ability has on economies of size. In the empirical part, economies of size are estimated for a sample of dairy farms using a proxy for managerial ability, which is calculated as a technical efficiency index. The results show that increasing farm size while holding managerial ability constant can be an important source of diseconomies of size. Copyright 2003, Oxford University Press.

From efficiency measurement to efficiency improvement: The choice of a relevant benchmark

Abstract This article deals with efficiency improvement and how to identify appropriate benchmarks for inefficient firms to imitate. We argue that the most relevant benchmark is the most similar efficient firm. Having interpreted similarity in terms of input endowments, the problem reduces to find the closest reference firm on the efficient subset of the isoquant. To such an end, we introduce the concept of input-specific contractions. This concept allows to find the shortest path to the efficient subset. This information can be used to advise inefficient firms about which efficient firm to visit in order to detect its mistakes and to learn better managerial practices.

Using Cross-Section Data to Adjust Technical Efficiency Indexes Estimated With Panel Data

This article proposes a procedure to incorporate cross-sectional information in the estimation of technical efficiency indexes obtained from panel data. A conventional index of technical efficiency is estimated in a first stage using panel data on inputs and outputs. The individual effects from the first stage are then adjusted using cross-sectional information, obtaining a corrected technical efficiency index. The model is applied to a panel of eighty-two Spanish dairy farms, where only cross-sectional information about input quality is available. An analysis of variance is performed between some variables and both the corrected and the uncorrected indexes, finding that the conclusions derived from the two analyses are different. Copyright 1999, Oxford University Press.

Modeling Unobserved Heterogeneity in New York Dairy Farms: One-Stage versus Two-Stage Models

Agricultural production estimates have often differentiated and estimated different technologies within a sample of farms. The common approach is to use observable farm characteristics to split the sample into groups and subsequently estimate different functions for each group. Alternatively, unique technologies can be determined by econometric procedures such as latent class models. This paper compares the results of a latent class model with the use of a priori information to split the sample using dairy farm data. Latent class separation appears to be a superior method of separating heterogeneous technologies and suggests that technology differences are multifaceted.

Determinants of Tourists’ Length of Stay: A Hurdle Count Data Approach

This article analyses tourists’ length of stay in a particular destination using a Hurdle Count Data model that allows us to first identify the determinants of the decision to be a same-day visitor or a tourist, and then to explain the length of stay for tourists. Apart from sociodemographic characteristics, we are interested in the effects of distance, mode of transport, and some relevant destination attributes of the destination such as tranquillity, natural environment, or climate. Another feature this article addresses is how advertising, recommendations, and previous experience at the destination affect both the probability of an overnight stay and the length of the stay. The results indicate that the determinants of the decision to stay overnight and how long to stay are not the same. Besides, a positive previous experience and having seen advertising of the destination positively affect the overnight stay decision and the number of days.