Laure Latruffe

DETERMINANTS OF TECHNICAL EFFICIENCY OF CROP AND LIVESTOCK FARMS IN POLAND

Poland, one of the candidate countries for European Union membership, is currently experiencing acute structural problems within its agriculture sector. This article analyses technical efficiency and its determinants for a panel of individual farms in Poland specialized in crop and livestock production in 2000. Technical efficiency is estimated with stochastic frontier analysis (SFA) and confidence intervals are constructed. Determinants of inefficiency are also evaluated. The SFA results are compared with results using Data Envelopment Analysis (DEA). On average, livestock farms are more technically efficient than crop farms. For both specializations, the size–efficiency relationship is positive, that is large farms are more efficient. The SFA findings are generally supported by the DEA results. Soil quality and the degree of integration with downstream markets are highly important determinants of efficiency. The use of factor markets (land and labour) is important for crop farms, while livestock farms can rely on family labour and own land. Also, education is a constraint to efficiency particularly for crop farms.

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.

The Impact of Credit Market Imperfections on Farm Investment in Poland

The objective of this article is to confirm the presence of imperfections on the rural credit market in Poland in the second half of the transition period, and to identify farms that were the most affected by these imperfections. For this, an investment accelerator model augmented with a cash flow variable was used on panel data for individual farms during 1996–2000. The cash flow coefficient was found to be significant and positive, indicating a poorly functioning rural credit market, in the sense that for some farms internal funds were the only source of funds (for farms facing credit rationing) or a less expensive source (for farms facing high borrowing costs) than debt. Farms facing more severe credit constraints were then identified by splitting the sample into two groups according to a single criterion but also by creating classes with a multiple component analysis. Farms less collateralisable were found to have experienced the most severe constraints. This finding is in line with other existing studies on Polish farms and is in contradiction with Polish government intervention that favoured subsidised loans rather than guaranteed credit during the period studied.

Determinants of technical efficiency of Slovenian farms

This article investigates the determinants of technical efficiency of Slovenian farms during the transition to a market economy and before accession to the European Union (1994–2003). Both the parametric stochastic frontier and the non-parametric data envelopment analysis (DEA) methods show that the degree of technical efficiency has increased during the transition, and that farm specialisation associated with technological change is found to be a crucial determinant for increasing technical efficiency. A negative impact of farm commercialisation on technical efficiency is found, explained by the specific nature of livestock farms, in particular, with intra-farm intermediary consumption. The use of hired labour has no significant influence, but mixed results are found for rented land. The results suggest possible sources of imperfections in farm input markets.

Measures of farm business efficiency

Purpose – The aim of this paper is to investigate technical, scale, allocative and economic efficiencies by data envelopment analysis (DEA) and stochastic frontier methods to provide a decision‐making tool and managerial implications in the measurement of farm business performance and efficiency.Design/methodology/approach – Technical, scale, allocative and economic efficiencies are analyzed with the Farm Accountancy Data Network (FADN) sample for 13 farm business branches in Slovenia in the period 1994‐2003. DEA models are used with an output‐orientation, three outputs and four inputs. The non‐parametric DEA estimations are compared with a parametric stochastic frontier approach. The cluster analysis is used to identify three different farm business groups according to their performance.Findings – The average technical, scale, allocative and economic efficiencies for the whole FADN sample over the analyzed period are relatively high (around or over 0.90), suggesting that, although the FADN sample contain...

An application of the DEA double bootstrap to examine sources of efficiency in Bangladesh rice farming

In this article we examine sources of technical efficiency for rice farming in Bangladesh. The motivation for the analysis is the need to close the rice yield gap to enable food security. We employ the DEA double bootstrap of Simar and Wilson (2007) to estimate and explain technical efficiency. This technique overcomes severe limitations inherent in using the two-stage DEA approach commonly employed in the efficiency literature. From a policy perspective our results show that potential efficiency gains to reduce the yield gap are greater than previously found. Statistically positive influences on technical efficiency are education, extension and credit, with age being a negative influence.

The Use of Bootstrapped Malmquist Indices to Reassess Productivity Change Findings: An Application to a Sample of Polish Farms

This article assesses the extent to which sampling variation affects findings about Malmquist productivity change derived using data envelopment analysis (DEA), in the first stage by calculating productivity indices and in the second stage by investigating the farm-specific change in productivity. Confidence intervals for Malmquist indices are constructed using Simar and Wilsons (1999) bootstrapping procedure. The main contribution of this article is to account in the second stage for the information in the second stage provided by the first-stage bootstrap. The DEA SEs of the Malmquist indices given by bootstrapping are employed in an innovative heteroscedastic panel regression, using a maximum likelihood procedure. The application is to a sample of 250 Polish farms over the period 1996 to 2000. The confidence intervals’ results suggest that the second half of 1990s for Polish farms was characterized not so much by productivity regress but rather by stagnation. As for the determinants of farm productivity change, we find that the integration of the DEA SEs in the second-stage regression is significant in explaining a proportion of the variance in the error term. Although our heteroscedastic regression results differ with those from the standard OLS, in terms of significance and sign, they are consistent with theory and previous research.

Productivity change in Polish agriculture: an illustration of a bootstrapping procedure applied to Malmquist indices

This article illustrates the usefulness of applying bootstrap procedures to total factor productivity Malmquist indices, derived with data envelopment analysis (DEA), for a sample of 250 Polish farms during 1996–2000. The confidence intervals constructed as in Simar and Wilson suggest that the common portrayal of productivity decline in Polish agriculture may be misleading. However, a cluster analysis based on bootstrap confidence intervals reveals that important policy conclusions can be drawn regarding productivity enhancement.

Effect of public subsidies on farm technical efficiency: a meta-analysis of empirical results

ABSTRACT Investigating the impact of public subsidies on farm technical efficiency is becoming a critical issue in applied agricultural policy analysis. This article presents a meta-analysis of empirical results on this issue, based on data gathered from a systematic literature review. We find that, in the empirical literature, subsidies are commonly negatively associated with farm technical efficiency. Meta-regression estimation results show that the direction (significantly negative, significantly positive or non-significant) of the observed effects is sensitive to the way subsidies are modelled in the empirical studies.

Subsidies and Technical Efficiency in Agriculture: Evidence from European Dairy Farms

Abstract The objective of this article is to examine the association between agricultural subsidies and dairy farm technical efficiency in the European Union, and in so doing we make novel contributions to the literature. We include in the analysis nine diverse western European Union (EU) countries over an 18‐year period (1990‐2007) encompassing the various Common Agricultural Policy (CAP) reforms enacted since the inception of the EU. Further, we account for input endogeneity using an original method of moments estimator. Our results show that the effect of subsidies on technical efficiency may be positive, null, or negative, depending on the country. The analysis reveals that the introduction of decoupling with the 2003 CAP reform weakens the effect that subsidies have on technical efficiency.