New Economics Papers
on Efficiency and Productivity
Issue of 2008‒11‒25
34 papers chosen by

  1. Measuring productivity differentials€ӠAn application to milk production in Nordic countries By Sipilainen, T.; Kuosmanen, T.; Kumbhakar, S.C.
  2. How "efficient" are dairy farms in mountain areas? By Ortner, K.M.
  3. Social protection performance in the European Union: comparison and convergence By COELLI, Tim; LEFEBVRE, Mathieu; PESTIEAU, Pierre
  4. Technical Efficiency of the Crop Farms under the Various CAP Reforms: Empirical Studies for Germany, the Netherlands and Sweden By Zhu, Xueqin; Oude Lansink, Alfons
  5. Productivity Growth and Biased Technological Change in UK Airports By Carlos Pestana Barros; William L. Weber
  6. PERFORMANCES AND EFFICIENCIES OF THE IRRIGATION WATER USERS€٠ASSOCIATIONS IN TUNISIA By Frija, Aymen; Speelman, Stijn; Chebil, Ali; Buysse, Jeroen; Van Huylenbroeck, Guido
  7. Technology Adoption in French Agriculture and the Role of Financial Constraints By Blancard, S.; Boussemart, J.P.; Briec, W.; Kerstens, K.
  8. "Agglomeration Economies within IT-Producing and IT-Consuming Industries in U.S. Regions" By Simon Condliffe; William Latham; Christian Le Bas; Frédéric Miribel
  10. Productivity differences across OECD countries, 1970–2000: the world technology frontier revisited By Growiec, Jakub
  11. Farm Heterogeneity and Efficiency in Polish Agriculture: A Stochastic Frontier Analysis By Hockmann, H.; Pieniadz, A.
  12. Does IT investment improve bank performance? Evidence from Europe By Elena Beccalli
  13. The contribution of innovations in total factor productivity of organic olive enterprises By Karafillis, C.C.; Papanagiotou, E.
  14. Comparative Efficiency Assessment of Primary Care Models Using Data Envelopment Analysis By Olga Milliken; Rose Anne Devlin; Vicky Barham; William Hogg; Simone Dahrouge; Grant Russell
  16. Comparing Sustainable Value Approach, Data Envelopment Analysis and indicator approaches - An application on German dairy farms By Ehrmann, Markus
  17. Change of asset efficiency in EU agriculture: challenges for new members By Takacs, I.
  18. Productivity Growth and Biased Technological Change in Hydroelectric Generating Dams By Carlos P. Barros; Walter Briec; Nicolas Peypoch
  19. Economics and Productivity of Organic versus Non-organic Dairy Farms in the United States By Gillespie, J.; Nehring, R.; Hallahan, C.; Morrison-Paul, C.; Sandretto, C.
  20. Analyzing the impact of direct subsidies on the performance of the Greek Olive Farms with a non-monotonic efficiency effects model By Zhu, Xueqin; Karagiannis, Giannis; Lansinkl, Alfons Oude
  22. Competitiveness of dairy farms in three countries: the role of CAP subsidies By Zhu, Xueqin; Demeter, Robert Milan; Lansink, Alfons Oude
  23. Measuring Productivity Change without Neoclassical Assumptions: A Conceptual Analysis By Balk, B.M.
  25. Why Should Regional Agricultural Productivity Growth Converge? Evidence from Italian Regions By Esposti, R.
  26. Agricultural Productivity Growth in the Euro-Med Region: Is there Evidence of Convergence? By Galonopulos, K.; Surry, Y.; Mattas, K.
  27. Learning-by-Doing and Productivity Dynamics in Manufacturing Industries By Andrew Clarke
  28. Technical Efficiency, Regulation, and Heterogeneity in Japanese Airports By Carlos Pestana Barros; Shunsuke Managi; Yuichiro Yoshida
  30. Firm Size and Productivity By Danny Leung; Césaire Meh; Yaz Terajima
  32. An Examination of the Relationship Between Subsidies on Production and Technical Efficiency in Agriculture: The Case of Cotton Producers in Greece By Emvalomatis, Grigorios; Oude Lansink, Alfons; Stefanou, Spiro E.
  33. Adding Rungs to the Exporting Ladder: Plant-Level Exporting Dynamics and Total Factor Productivity Growth By Voicu, Alexandru
  34. Agglomeration Externalities and Technical Efficiency in Pig Production By Larue, S.; Latruffe, L.

  1. By: Sipilainen, T.; Kuosmanen, T.; Kumbhakar, S.C.
    Abstract: The aim of this paper is to analyse the regional productivity differentials on dairy farms in Denmark, Finland and Sweden. Several methods have been suggested for analysing productivity differentials in agriculture between groups of farms or countries. Hayami [5] and Hayami and Ruttan [7] suggested the meta-production function approach. This idea has been further developed by Lau and Yotopoulos [9] and Fulginity and Perrin [13]. Battese and Rao [2] suggested the meta-frontier analysis for these comparisons. One of the advantages of meta-frontiers with respect to metaproduction functions is that they are able to separate technological differences from the differences in technical efficiency. Battese et al. [5] and O€لonnell et al. [16] have extended this idea and developed both parametric and nonparametric approaches. In this paper, we extend the metafrontier analysis to the concave nonparametric least squares estimation of the production function suggested by Kuosmanen [18,19]. In addition, we compare the results with the approach where the estimation of meta-frontier can be avoided. The reference can also be the maximum output providing technology that is the one that yields the maximum estimated output, given inputs [21]. In this case the estimation can be based either on average or frontier production functions. The farm level data is obtained from the EU€ٳ Farm Accountancy Data Network data set for Denmark, Finland and Sweden. They cover 954 dairy farms in 2003. The results suggest that different method provide slightly different results but in all approaches productivity differentials are considerable in favour of Danish farms. In addition, the Danish technology is not only dominating at the mean but also at most of the data points.
    Keywords: productivity, technical efficiency, meta-frontier, Productivity Analysis,
    Date: 2008
  2. By: Ortner, K.M.
    Abstract: Pure Technical Efficiency scores of Austrian dairy farms are estimated econometrically on the basis of data envelopment analysis and bootstrapping. In a second stage, using the same assumptions on the distribution of error terms, the distances of farms to their production possibility curve are estimated as functions of farm attributes. Since some of these attributes refer to natural conditions which are more or less unfavourable, the farms in the sample are facing individual frontiers. The distinction between sectorial and individual frontiers gives rise to a distinction between €ܯverall€ݠand €ܦirm-level€ݠefficiency. Using overall efficiency for the calculation of possible savings from a move to the frontier will overestimate these savings and underestimate the efficiency of a farm relative to the conditions in which it operates.
    Keywords: DEA, efficiency, dairy farms, Farm Management, Livestock Production/Industries,
    Date: 2008
  3. By: COELLI, Tim (CEPA, University of Queensland); LEFEBVRE, Mathieu (CREPP, Université de Liège); PESTIEAU, Pierre (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))
    Abstract: In this paper we use data on five social inclusion indicators (poverty, inequality, unemployment, education and health) to assess the performance of 15 European welfare states (EU15) over a ten-year period from 1995 to 2004. Aggregate measures of performance are obtained using index number methods similar to those employed in the construction of the widely used Human Development Index (HDI). These are compared with alternative measures derived from data envelopment analysis (DEA) methods. The influence of methodology choice and the assumptions made in scaling indicators upon the results obtained is illustrated and discussed. We also analyse the evolution of performance over time, finding evidence of some convergence in performance and no sign of social dumping.
    Keywords: performance measure, best practice frontier, social protection.
    JEL: H50 C14 D24
    Date: 2008–03
  4. By: Zhu, Xueqin; Oude Lansink, Alfons
    Abstract: We analyse the impacts of the CAP reforms on the technical efficiency of the crop farms. We use an output distance function and an inefficiency effects model which incorporates the influences of exogenous variables on farm efficiency. We formulate policy variables (e.g. the CAP subsidies) and producer characteristics as explanatory variables in the inefficiency effects model. We use the 1995- 2004 FADN data to estimate the production frontiers of the crop farms in Germany, Netherlands and Sweden, to derive their technical efficiency, and to determine the effects of the explanatory variables. The study shows that the 10-year average technical efficiency of crop farms is 59% in Germany, 75% in Netherlands, and 70% in Sweden. The average annual technical efficiency change is 0.1%, 0.7% and 2.7% respectively for Germany, Netherlands and Sweden.
    Keywords: technical efficiency, the CAP reform, frontier models, crop farming, Agricultural and Food Policy, Farm Management, Research and Development/Tech Change/Emerging Technologies,
    Date: 2008
  5. By: Carlos Pestana Barros; William L. Weber
    Abstract: In this paper we estimate the total factor productivity of UK airports using a Malmquist index. Productivity change is factored into an index of efficiency change and an index of technological change. Technological change is further decomposed into indexes that measure the bias in the production of outputs, the bias in the employment of inputs, and the magnitude of the shift in the production frontier. Airports are ranked according to their productivity change for the period 2000-2005. The majority of UK airports did not improve their efficiency during the period. Economic implications are derived.
    Keywords: UK airports; productivity growth; biased technological change; policy implications
    Date: 2008–07
  6. By: Frija, Aymen; Speelman, Stijn; Chebil, Ali; Buysse, Jeroen; Van Huylenbroeck, Guido
    Abstract: This article analyzes the efficiency of Water Users Associations (WUA) in the Cap Bon region (Tunisia) and studies its main determinants. The analysis is performed in two stages. First, the efficiency is measured via the nonparametric €܄ata Envelopment Analysis€ݠ(DEA) technique. The DEA models are constructed not only to assess the overall WUA efficiency but also to evaluate the management and engineering sub-vectors efficiencies separately through a mathematical modification in the initial DEA model. In a second stage critical determinants of efficiency are determined using a Tobit model. In this analysis the focus is on technical (characteristics of the irrigation area and network), organizational and administrative variables. Results show that on average 18.7% of the used inputs could be saved if the WUA would operate on the frontier. The average scale efficiency, which can be calculated as the ratio between Constant and Variable Returns to Scale efficiency measures was around 71%, indicating that many WUAs are not operating at an efficient scale. Subvectors efficiencies show that WUAs present better performances in maintenance activities than in management. The inefficiency found can furthermore be mainly attributed to the number of years of experience in operating a WUA in addition to the number of water pumping stations managed and the rate of the exploited area. The scale inefficiencies are mainly due to administrative and organizational variables.
    Keywords: WUA, irrigation, efficiency, DEA method, Institutional and Behavioral Economics, Land Economics/Use,
    Date: 2008
  7. By: Blancard, S.; Boussemart, J.P.; Briec, W.; Kerstens, K.
    Abstract: Successive CAP reforms have increased the exposure of European agriculture to market forces. As a result, farmers have become preoccupied with their competitiveness and have progressively adopted best practices. However, these long-run technological adjustments could be slowed down by eventual shortrun financial constraints. This contribution measures the role of these financial constraints on the catching-up component of total factor productivity for a panel of French farmers in Nord-Pas-de-Calais region during 1994-2001. For TFP estimates based on non-parametric distance functions, the second stage econometric results indicate that the technological adaptation is significantly conditioned by financial constraints.
    Keywords: TFP catching-up, distance function, financial constraints, Agricultural Finance, Farm Management, Research and Development/Tech Change/Emerging Technologies,
    Date: 2008
  8. By: Simon Condliffe (Department of Economics,West Chester University of Pennsylvania); William Latham (Department of Economics,University of Delaware); Christian Le Bas (Department of Economics,University of Lyon); Frédéric Miribel
    Abstract: This paper deals with the effects of the geographic concentration of economic activity on productivity through agglomeration economies in the U.S. economy. Our empirical study extends the literature on agglomeration economies in two directions. First we measure and compare the effects on productivity of geographic concentration in either information technology related activity (the IT sector) or in all other economic activities (the non-IT sector). Second we follow Jorgenson’s (2002) reasoning regarding the significance of the differences between IT-producing sectors and IT-using sectors and assess the differential effects of concentration in IT-producing sectors and concentration in IT-using sectors on productivity. We utilize four measures of agglomeration and analyze effects at two levels of geographic disaggregation: U.S. states and U.S. counties. We perform the analysis using a model drawn from the growth accounting literature in which total labor productivity in a region is the dependent variable. It is modeled as a function of the region’s capital-output ratio, the quality of the region’s labor supply as measured by the level of education, and an agglomeration variable measured by concentration in the IT or non-IT sectors or in the IT-producing or IT-using sectors. The cross section estimates for a single year yield mixed results. We find weak evidence in favor of an effect of concentration of IT activity on productivity at the state level. We find stronger effects on productivity at the county level from concentration in IT-producing sectors.
    Keywords: Agglomeration Economies, Information Technology, Productivity
    JEL: R11 O33 D24 D62
  9. By: Lien, Gudbrand; Kumbhakar, Subal C.; Hardaker, J. Brian
    Abstract: Little attention has been given in the agricultural economics literature to the impact of off-farm work on farm productivity and efficiency. More knowledge about what determines part-time farming and whether farm productivity and efficiency are affected by part-time farming could help policy makers introduce better targeted rural development policies. This paper aims to fill the above-mentioned gaps by first analysing factors that influence the choice of off-farm work; and then examining how off-farm work influences productivity and technical efficiency at the farm level. An unbalanced panel data set from 1991 to 2005 from Norwegian grain farms is used for this purpose. The results show that the likelihood of off-farm work and the share of time allocated to it increase with increasing age (up to 39 years), and with low relative yields (compared to others farms in the surrounding area/region). The level of support payments is not significantly associated with the extent of off-farm work. Large-scale farms and single farmers tend to have a lower likelihood of off-farm work. Average technical efficiency was found to be 79%. Farmers with low variability in farm revenue were found to be more technically efficient than farmers with high revenue variability. We did not find any evidence of off-farm work share affecting farm productivity ˆҠthe predicted off-farm work share was not statistically significant. In other words, we did not find any systematic difference in farm productivity and technical efficiency between part-time and full-time farmers.
    Keywords: off-farm work, productivity, efficiency, unobserved heterogeneity, panel data, Farm Management,
    Date: 2008
  10. By: Growiec, Jakub
    Abstract: We re-estimate the World Technology Frontier (WTF) non-parametrically, using the Data Envelopment Analysis method, with a dataset covering both OECD country-level and US state-level data on GDP per worker and the stocks of physical capital, unskilled labor, and skilled labor. The WTF 2000 is found to be spanned by a few US states such as Colorado, Connecticut, Delaware, Nevada, Utah, and Washington, while the USA as a whole falls markedly behind these leader states. The auxilliary use of US state-level data adds extra precision to cross-country growth and levels accounting exercises. We also calculate the "appropriate technology vs. efficiency" decomposition, disentangling dynamic shifts of the WTF from movements along the WTF. Our results indicate that previous estimates of the WTF might have been downward biased and previous estimates of technical efficiency might have been upward biased.
    Keywords: world technology frontier; decomposition; country-level data; US state-level data; development accounting; growth accounting
    JEL: O11 O47 E23 O33 O14
    Date: 2008–11–14
  11. By: Hockmann, H.; Pieniadz, A.
    Abstract: This paper deals with the estimation of a random coefficient model. The virtue of this approach is that it considers firm heterogeneity, which conventional SFA models do not. Applying the model to Polish farms, the results indicate that the conventional random and fixed effect models overestimate the inefficiency score. In addition, the reasons for inefficiency are analysed. It is shown that despite the fragmentation of Polish agriculture, there is no evidence for scale inefficiency. Moreover, inefficiency could partly be attributed to factors that affect management input and requirements on farms.
    Keywords: SFA, random component model, Poland, agriculture, management, Productivity Analysis,
    Date: 2008
  12. By: Elena Beccalli (Univesity of Macerata)
    Abstract: <p> </p><p> </p><p> </p><p align="left">This paper investigates whether investment in Information Technology (IT), hardware,</p><p align="left">software and other IT services influences the performance of banks. Using a sample of 737</p><p align="left">European banks over the period 1993-2000 we analyse whether IT investment is reflected</p><p align="left">in improved performance (measured using both standard accounting ratios and cost and</p><p align="left">alternative product efficiency measures). Despite banks being major investors in IT we found</p><p align="left">little relationship between total IT investment and improved bank profictability or efficiency</p><p align="left">indicating the existence of a profictability paradox. However, the impact of different types of</p><p align="left">IT investment (hardware, software and services) on banks' performance is heterogeneous.</p><p align="left">Investment in IT services from external providers (consulting services, implementation</p><p align="left">services, training and education, support services) appears to have a positive influence</p><p align="left">on accounting products and product efficiency, while the acquisition of hardware and software</p><p align="left">seems to reduce banks' performance.</p>
    JEL: O1 O11
    Date: 2006–10
  13. By: Karafillis, C.C.; Papanagiotou, E.
    Abstract: This paper measures the contribution of innovations in total factor productivity(TFP) of organic olive farmers. By constructing an innovation variable instead of the use of a time trend, technical change is replaced by technical difference and TFP growth becomes TFP difference. Primary cross section data on organic olive enterprises from a Greek region is used in the application of the restricted frontier profit function. Farmers are classified into groups according to their innovative €ذrofile€ٮ TFP difference among consecutive innovation groups is decomposed into technical difference and adjustment in innovativeness effects. Furthermore, efficiency differences among innovation groups are estimated. Results indicate that more innovative farmers perform better than less innovative ones regarding TFP and efficiency scores. Adoption of innovations has a positive contribution in the reduction of inefficiency and profit-loss. The rate of technical difference is always positive in the formulation of TFP difference whereas the adjustment in innovativeness effects varies among the innovation groups. Finally, high-tech capital is more or less under-utilized, regardless of the innovation group.
    Keywords: Innovations, total factor productivity, profit efficiency, organic farming, Greece, Productivity Analysis,
    Date: 2008
  14. By: Olga Milliken (Department of Economics, University of Ottawa); Rose Anne Devlin (Department of Economics, University of Ottawa); Vicky Barham (Department of Economics, University of Ottawa); William Hogg (Department of Family Medicine, University of Ottawa); Simone Dahrouge (C.T. Lamont Primary Health Care Research Centre, Élisabeth Bruyère Research Institute, Ottawa); Grant Russell (C.T. Lamont Primary Health Care Research Centre, Élisabeth Bruyère Research Institute, Ottawa)
    Abstract: This paper compares the productive efficiencies of four models of primary care service delivery in Ontario, Canada, using the data envelopment analysis (DEA) method. Particular care is taken to include quality of service as part of our output measure. The influence of the delivery model on productive efficiency is disentangled from patient characteristics using regression analysis. Significant differences are found in the efficiency scores across models and within each model. In general, the fee-for-service arrangement ranks the highest and the community-health-centre model the lowest in efficiency scoring. The reliance of our input measures on costs and number of patients, clearly favours the fee-for-service model. Patient characteristics contribute little to explaining differences in the efficiency ranking across the models.
    Keywords: Productive Efficiency; DEA; Primary Health Care
    JEL: I12 I19
    Date: 2008
  15. By: Bokusheva, Raushan; Kumbhakar, Subal
    Abstract: Limited budget for the purchase of variable inputs might adversely affect producer's input use decisions and might result in a non-optimal input usage. If expenditure constrains are present and binding, unconstrained profit-maximization is not valid for modelling producers' input use decisions. In this paper we apply the indirect production function approach which describes output maximization subject to a given technology, a set of quasi-fixed inputs and a given budget for the purchase of variable inputs. By employing the indirect production function in the stochastic frontier framework we can estimate producer's output loss due to both expenditure constraints and technical inefficiency. Our estimation results show that most of the study farms were expenditure constrained during the considered period. Expenditure constraints have caused on average a potential output loss of 11 percent. Output loss due to technical inefficiency is quite moderate and averages 18 percent.
    Keywords: Indirect production function, SFA, expenditure constraints, technical efficiency, Russian agriculture, Farm Management, Research Methods/ Statistical Methods,
    Date: 2008
  16. By: Ehrmann, Markus
    Abstract: Objective of this paper is to compare different measurement concepts for sustainability at farm level in Germany: a) Sustainable Value Approach (SV), b) Data Envelopment Analysis (DEA) and c) indicator approaches close to KUL (Criteria for an Ecologically Compatible Land Management). The mathematical programming model FARMIS is extended wrt the underlying subject and applied for quantitative analysis. Indicators based on physical inputs are calculated based on monetary data of national FADN data. The methods are applied to a sample of about 4000 representative dairy farms. Results of SV are given in both absolute values and return-to-cost ratios which take farm size into account. Considering relationships between methods we found out that correlation between DEA and SV results are higher than 0.75. The indicator methods show correlations with the other approaches of more than 0.5 for economic indicators but a rather low correlation for ecological indicators. Further we identified characteristics of farms with high efficiency and sustainable performance. In order to show differences of used methods results are given by regions, size classes and orientation of production. Results indicate that bigger farms generate higher Sustainable Value. Farms in less favourable areas show a lower performance with regard to Sustainable Value and efficiency than farms located in other areas.
    Keywords: Sustainable Value Approach, agriculture sustainability, Environmental Economics and Policy, Livestock Production/Industries,
    Date: 2008
  17. By: Takacs, I.
    Abstract: Efficiency of farm assets is a very important factor of competitive production. It is in strong correlation with profitability of economic activities. One of the most important factor of the farm assets is the fixed assets, especially machinery. As it could be observed during the 1980s and 1990s on the farms of developed countries, the technical development was a considerable factor of farming. During that period the technical supply of farms increased significantly, at the same time the farm labour decreased, so the labour productivity rose considerably. This paper, based on the data of FADN, focuses on the investigation of some figures of the European Union for asset and labour efficiency between 1989 and 2005, and analyses what happened after 2004 when 10 new member countries accessed to the EU. The most important results of the research are that the farms of the new member countries are equipped at a considerably lower level in general and at the same time they use farm assets less efficiently than farms of the former member countries, and the result is that the competitiveness of the farms of new members is significantly lower. On the other hand, in the new member countries the agricultural policy focused on developing arable farming, so the gaps in the labour productivity are narrower in the field crop farms than in horticulture or animal husbandry. The gap in the labour productivity is the widest at the largescale farms, which can be explained not only with less assets but with lower capital efficiency as well.
    Keywords: productivity, labour, FADN, Productivity Analysis,
    Date: 2008
  18. By: Carlos P. Barros; Walter Briec; Nicolas Peypoch
    Abstract: This paper analyses productivity growth and the nature of techni- cal change in a sample of Portuguese hydroelectric generating plants over the period 2001 to 2004. In a ¯rst step, we employ the Luen- berger productivity indicator to estimate and decompose productivity change. The results paint a picture of mixed productivity performance in the Portuguese energy sector. In a second step, we analyse the na- ture of this technical change by using the recent concept of parallel neutrality (Briec et al., 2006). We observe a global shift in the best practice frontier as well as evidence of input bias in technical change.
    Keywords: hydroelectric energy; Portugal; Luenberger productivity indicator; parallel neutrality.
    JEL: G21 D24
    Date: 2008–06
  19. By: Gillespie, J.; Nehring, R.; Hallahan, C.; Morrison-Paul, C.; Sandretto, C.
    Abstract: Technical and scale efficiencies are estimated for organic and non-organic dairy farms in the United States using an input distance function approach. A multinomial logit analysis is used to categorize the farms by technology. Large conventional farms outperformed smaller farms in most technology / organic / non-organic categories. There was high variability in net returns among the organics so that they did not differ significantly from the large conventional farms. The largest conventional non-organic operations and conventional organic operations tended to have the higher technical efficiencies.
    Keywords: organic dairy production, input distance function, technical efficiency, Livestock Production/Industries,
    Date: 2008
  20. By: Zhu, Xueqin; Karagiannis, Giannis; Lansinkl, Alfons Oude
    Abstract: We analyse the impacts of the CAP reforms on technical efficiency of Greek olive farms. We use a production frontier function and a non-monotonic inefficiency effects model which incorporates the influences of exogenous variables on the mean and the variances of farm efficiency. We formulate policy variables (e.g. the direct subsidies) and farm characteristics as explanatory variables in the inefficiency effects model. We use the 1995-2004 FADN data to estimate the production frontier, to derive technical efficiency, and to determine the effects of the explanatory variables. The study shows that the 10-year average technical efficiency of olive farms is 69%. Direct transfers have a negative and monotonic effect on technical efficiency, while the degree of specialization has a non-monotonic effect on technical efficiency.
    Keywords: technical efficiency, the CAP reform, non-monotonic inefficiency effects, production frontier, olive-farming, Agricultural and Food Policy, Crop Production/Industries,
    Date: 2008
  21. By: Sipiläinen, Timo; Marklund, Per-Olov; Huhtala, Anni
    Abstract: Promotion of environmental sustainable farming practices is an important policy goal for the whole agricultural sector. However, when the efficiency of production is measured in practice, enhancement of environmental quality such as biodiversity and other environmental amenities does not seem to be recognized as a positive output produced by agriculture. Here, we include crop diversity index as an indicator of environmental output in a comparison of efficiency of conventional and organic crop farms. Non-parametric technical efficiency scores are estimated applying data envelopment analysis on a sample of Finnish crop farms for 1994 €Ӡ2002. The results show that in a pooled data set conventional crop farms are more technically efficient than organic farms when only crop output is considered. When taking crop diversity into account the difference between production techniques vanishes. In separate comparisons of conventional and organic farms, the average efficiencies of the two groups do not differ statistically significantly. Thus, the assumptions on the technology and reference sets are crucial with respect to the results of the comparison. This has important implications for policy evaluations when alternative farming technologies are compared.
    Keywords: crop diversity, Shannon index, DDEA, technical efficiency, Environmental Economics and Policy, Farm Management, Research Methods/ Statistical Methods,
    Date: 2008
  22. By: Zhu, Xueqin; Demeter, Robert Milan; Lansink, Alfons Oude
    Abstract: This paper investigates the impact of CAP subsidies on the competitiveness of dairy farms in Germany, the Netherlands, and Sweden. Technical efficiency results show that coupled subsidies have negative impacts in Germany and the Netherlands, but no significant impacts in Sweden. Decoupled subsidies negatively affect technical efficiency in each country and to a larger extent than coupled subsidies. Relative productivity results indicate that Dutch technology leads to the highest output, followed by technologies in Germany and Sweden. Dutch farms can improve their competitiveness by exploring their current production potential. Besides improving efficiency, German and Swedish farms may have options to improve their production technology.
    Keywords: technical efficiency, output distance function, dairy farm, subsidy, relative productivity, Agricultural and Food Policy, Livestock Production/Industries,
    Date: 2008
  23. By: Balk, B.M. (Erasmus Research Institute of Management (ERIM), RSM Erasmus University)
    Abstract: The measurement of productivity change (or difference) is usually based on models that make use of strong assumptions such as competitive behaviour and constant returns to scale. This survey discusses the basics of productivity measurement and shows that one can dispense with most if not all of the usual, neoclassical assumptions. By virtue of its structural features, the measurement model is applicable to individual establishments and aggregates such as industries, sectors, or economies.
    Keywords: producer;profit;profitability;productivity;decomposition;capital;index number theory
    Date: 2008–11–17
  24. By: Giannoccaro, G.; Prosperi, M.; Zanni, G.
    Abstract: With the enforcement of the Water Framework Directive 2000/60/EC (WFD), policy makers are required to pursue the improvement of the use efficiency of the water resources in the agricultural sector. For this purpose, we suggest a methodology to perform an ex-ante analysis of the efficiency of water pricing policies, based on a two stage DEA technique, by which it is possible to disaggregate the technical and the ecological efficiency of the policy. According to our results, we found that, coherently with the WFD principles, the direct pricing methods show the highest levels of efficiency. However, we have also found that some indirect pricing methods show relatively high levels of efficiency. Therefore, since the high cost for the management and implementation of water measurement devices required to apply the volumetric methods, indirect pricing methods might still be preferable.
    Keywords: Data Envelopment Analysis, efficiency, water pricing, water framework directive, Resource /Energy Economics and Policy,
    Date: 2008
  25. By: Esposti, R.
    Abstract: The paper analyses agricultural TFP growth across Italian regions during the 1952-2002 period, and aims at identifying those factors that favour or hinder regional agricultural TFP growth convergence. Of major relevance is whether regions, despite their inescapable heterogeneity, tend to share common technological improvements, that is, to move along the same productivity growth rate. TFP growth decomposition ultimately allows attributing observed productivity performance to convergence and divergence forces. Appropriate testing and estimation procedures are adopted to take into account panel unit-root issues and cross-sectional dependence.
    Keywords: TFP growth, Convergence, Panel Data, Productivity Analysis,
    Date: 2008
  26. By: Galonopulos, K.; Surry, Y.; Mattas, K.
    Abstract: This paper measures agricultural productivity growth by means of the sequential Malmquist Total Factor Productivity (TFP) index among a set of thirty-two countries including West European, Central and East European (CEE) and Middle East and North African (MENA) countries for the period 1961-2002. At a second stage it is also investigated whether this measure is converging among the countries, by employing cross-sectional tests for absolute and conditional β-convergence as well as for club convergence. Results suggest that despite the fact that the CEE and MENA countries exhibit a high rate of productivity growth after the 1990s, absolute convergence cannot be accepted. Still, evidence for conditional convergence is found and the formation of two separate clubs of countries that converge to different equilibrium points is identified.
    Keywords: Productivity growth, sequential Malmquist TFP, convergence., Productivity Analysis,
    Date: 2008
  27. By: Andrew Clarke
    Abstract: This paper estimates a structural model of learning-by-doing. Treating production experience as a state variable, this paper provides estimates of the structural parameters obtained from the first order conditions arising from the plant’s maximization problem. Estimates are provided using data on 4-digit manufacturing industries and plant-level observations. Using aggregate industry data, the results indicate that estimated learning rates might be considerably lower than previous estimates. The results also reveal considerable variation in estimated learning rates, across broad industry groups, at both the plant-level and the 4-digit industry level. This implies that using results from existing studies that focus upon specific, narrowly defined industries or firms, may lead to misleading conclusions concerning the widespread importance of learning-by-doing for generating productivity dynamics within the manufacturing industry
    Keywords: Production Experience; Learning-by-Doing; Structural Estimation
    JEL: C13 D21 L23 L60
    Date: 2008
  28. By: Carlos Pestana Barros; Shunsuke Managi; Yuichiro Yoshida
    Abstract: In this paper, the random stochastic frontier model is used to estimate the technical efficiency of Japanese airports taking into regulation and heterogeneity in the variables. The airports are ranked according to their productivity for the period 1987 to 2005 and homogenous and heterogeneous variables in the cost function are disentangled. Policy implication is derived.
    Keywords: Japan; airports; efficiency; random frontier models; policy implications
    Date: 2008–08
  29. By: Carvahlo, M.L.; Henriques, P.D.; Costa, F.; Pereira, R.
    Abstract: This study aims to characterise the evolution of vineyard production, to measure the levels of technical efficiency, and to relate these with farmers and farms attributes. The sample used is composed of a panel of vineyard farms, for the period 2000-2005, belonging to Portuguese Alentejo region. The methodology used to estimate technical efficiency, was the stochastic production frontier. The results showed that there are room to improve the levels of technical efficiency in input use and that efficiency is variant with time. It was observed that technical efficiency increases with economic size and net farm income, as well as with family entrepreneurship.
    Keywords: efficiency, parametric, vineyard, Crop Production/Industries, Farm Management,
    Date: 2008
  30. By: Danny Leung; Césaire Meh; Yaz Terajima
    Abstract: This paper examines the relationship between firm size and productivity. In contrast to previous studies, this paper offers evidence of the relationship not only from manufacturing firms, but from non-manufacturing firms as well. Furthermore, the aggregate importance of the firm size-productivity relationship is gauged by calculating to what extent shifts in the distribution of employment over firm size categories has affected Canadian aggregate productivity, and whether differences in the employment distribution over firm size categories between Canada and the United States can account for the Canada-U.S. labour productivity gap. The importance of large and small firms to changes in productivity is also examined. <br><br> A positive relationship between firm size and both labour productivity and TFP is found in both the manufacturing and non-manufacturing sectors. Given this relationship, the difference in the employment distribution over firm sizes between Canada and the United States can account for half of the Canada-U.S. labour productivity gap in manufacturing.
    Keywords: Productivity
    JEL: L11 L25 O47
    Date: 2008
  31. By: Sojkova, Z.; Kropkova, Z.; Kovae, S.
    Abstract: This paper presents results of stochastic parametric approach used in estimation of farm technical efficiency. The estimation of output oriented technical efficiency was based on Stochastic Frontier analysis with Cobb-Douglas production function. Model specification for empirical application were employed Battese and Coelli 1995 model specification, where technical inefficiency effects are explicitly expressed as a function of a vector of firm-specific variables and random error and integrated in the stochastic frontier model. Model also included dummy variable which expressed production conditions in which Slovak farms are operating. We divided farms into two groups of production conditions: productive regions (PR) and less favorable area (LFA) regions. Data set included 79 Slovak farms operating in different regions in 2003-2005 time periods. Following input variables are included in the model: capital, material, labour and agricultural land according to LPIS system. Total product was used as output variable. Our analyses show that farms operated in 2004 achieved significantly highest level of technical efficiency in comparison with year 2003 in both groups of production condition, due to good weather condition in this year and due to increasing subsidy system. From the achieved results we can conclude that the significant statistical differences in average technical efficiency, was detected only in year 2005 between the farms of mentioned production conditions. Higher level of variability, in technical efficiency was detected in farms operating in productive regions compared to technical efficiency of farms in LFA regions.
    Keywords: less favorable area (LFA), subsidy, stochastic production frontier, panel data, output €Ӡoriented technical efficiency, Cobb-Douglas production function, Production Economics, Research Methods/ Statistical Methods,
    Date: 2008
  32. By: Emvalomatis, Grigorios; Oude Lansink, Alfons; Stefanou, Spiro E.
    Abstract: Subsidies on production have long been criticized for protecting producers from competition, and thus removing an incentive for efficient use of the resources. This study undertakes the examination of the impact of partially decoupled subsidies on the technical efficiency scores of cotton producers in Greece. The results indicate that compensatory area payments reduce the efficiency scores of the producers by diverting resources from products for which the subsidy is based on the area planted to the production of cotton, for which the aid is related to the volume of output.
    Keywords: panel data, stochastic distance function, subsidies in agriculture, Agricultural Finance, Crop Production/Industries, Production Economics,
    Date: 2008
  33. By: Voicu, Alexandru (CUNY - College of Staten Island)
    Abstract: We use panel data on Mexican manufacturing plants to study the dynamics of plant-level exporting activity at both the extensive and the intensive margins and the connection between exporting dynamics and plant-level total factor productivity growth. We find that exporting activity has a ladder structure. Most entries and exits take place at the bottom of the ladder and account for a small share of gross, industry-level changes in exports, employment, output, and productivity. The dynamics at the intensive margin is intense and heterogeneous. Plant mobility across deciles of export distribution has an inverted J-shape, top exporters being least likely to experience significant changes in their relative position. Simultaneously, similar shares of plants gradually move up and down the export ladder and changes in plants' relative position in the distribution of exports are positively correlated with changes in total factor productivity. Our results suggest that plants face not only fixed costs of entry, but also pre-entry uncertainty about conditions in the foreign markets and post-entry convex costs of adjusting their exporting activity and, as a result, a significant share of the productivity gains from trade accrues long after entry, when plants become large exporters.
    Keywords: NAFTA, trade liberalization, productivity, heterogeneity of plant-level performance
    JEL: C13 D24 F13 O47 O54
    Date: 2008–10
  34. By: Larue, S.; Latruffe, L.
    Abstract: The objective of the paper is to assess the effects of agglomeration on technical efficiency of French pig farms. We use a two-stage method to evaluate the effects of agglomeration on technical efficiency. The first stage consists in calculating pig activity€ٳ efficiency scores with the non-parametric method Data Envelopment Analysis (DEA). The second stage is a truncated regression of these scores on agglomeration variables. Data are for 899 French pig producers in 2004. Results suggest that these farms were as much affected by positive agglomeration externalities (that are knowledge spillovers due to farms€٠density, and also arise from farms€٠closeness to downstream market) as any other businesses. There was however no evidence of negative externalities in the form of constraints in farmers€٠land demand due to legal disposition relating to manure spreading.
    Keywords: Agglomeration, Externalities, Data Envelopment Analysis, Industrial Organization, Livestock Production/Industries,
    Date: 2008

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NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.