K Hervé Dakpo

Modelling pollution-generating technologies in performance benchmarking: Recent developments, limits and future prospects in the nonparametric framework

This article is a critical review of methods integrating environmental aspects into productive efficiency. We describe the classic modelling approach relying on the weak disposability assumption, and explain the major recent developments around the inclusion of undesirable outputs in production technology modelling, namely the materials balance principles and the weak G-disposability, the by-production modelling and the cost disposability assumption, and the unified model under natural and managerial disposability concepts. We discuss the limits inherent in each methodology and suggest future research perspectives.

Banks’ efficiency and credit risk analysis using by-production approach: the case of Iranian banks

ABSTRACT This article uses a by-production approach that integrates credit risk to monitor bank efficiency. The method overcomes the possible misspecification issues of the commonly assumed weak disposability (WDA) of undesirable outputs. In addition, our measure extends the classic by-production approach by including statistical aspects through subsampling techniques. We have also provided an algorithm to correct related infeasibilities. Using this approach, we investigate the performance of Iranian banks and credit risk management in the sector for the period 1998–2012. Non-performing loans (NPLs) have been used as an undesirable output and proxy for credit risk in our models. Based on our empirical results, although the banks generally exhibited efficiency improvements over time, their credit risk performance deteriorated considerably after the regulatory changes introduced in 2005. These findings confirm that credit quality can be monitored more actively across Iranian banks.

Three decades of productivity change in French beef production: a Färe-Primont index decomposition

The Fare‐Primont index is used to evaluate total factor productivity (TFP) change and its components for a sample of French suckler cow farms in grassland areas in 1985–2014. The results reveal an increase in TFP of 6.6 per cent over the whole observation period, with technological progress being the major source of productivity growth. Meanwhile, efficiency decreased. Farms experienced great technological progress from 1991 to 2000. From a methodological point of view, the comparison with results obtained with Malmquist indexes shows similar trends but different magnitudes, with the Malmquist index overestimating the TFP and technological changes compared to the Fare‐Primont index. In addition, the use of a sequential approach that restricts technological change to being positive or null allows for the precise calculation of technology changes, disregarding the effects of external conditions that are captured in efficiency changes. Finally, the estimation of full dimensional efficient facets (FDEFs) that guarantees the positivity of all shadow prices used to assess the mix efficiency component of TFP change is promising.

Productivity, technical efficiency and technological change in French agriculture during 2002-2015: a Färe-Primont index decomposition using group frontiers and meta-frontier

ABSTRACT The objective of the article is to assess productivity change in French agriculture during 2002–2015; namely, total factor productivity (TFP) change and its components – technological change and efficiency change. For this, we use the Färe-Primont index which verifies the multiplicatively completeness property and is also transitive, allowing for multi-temporal and -lateral comparisons. We investigate the extent of heterogeneity within each type of farming sub-sample in terms of TFP change, with the help of the Herfindahl-Hirschman index (HHI). In addition, to compare the technologies among the five types of farming considered, we extend our analysis to the meta-frontier framework. Results indicate that during 2002–2015, all farms experienced TFP progress. The smallest average increase was experienced by the dairy farms and the largest by the field crop farms and the beef farms. The latter had the strongest technological progress but a deterioration in efficiency, while the opposite was found for field crop farms. The analysis of HHI reveals that sheep or goat farms are the most homogenous in terms of the direction of TFP change experienced over the period 2002–2015. The meta-frontier analysis shows that field crop farms’ technology is the most productive of all the types of farming.