IDEAS home Printed from https://ideas.repec.org/a/bla/jageco/v41y1990i2p215-226.html
   My bibliography  Save this article

Alternative Production Frontier Methodologies And Dairy Farm Efficiency

Author

Listed:
  • B. E. Bravo‐Ureta
  • L. Rieger

Abstract

This paper estimates technical efficiency (TE) measures using four alternative production frontier models, and evaluates the sensitivity of the results to the choice of methodology. The Cobb‐Douglas functional form along with data for 1982 and 1983 from 404 dairy farms located throughout six northeastern states in the US are used in the estimation. A general conclusion is that, broadly speaking, frontier function models are neutrally upwardly scaled versions of the OLS or average model. A second conclusion is that different models yield markedly different efficiency levels across firms. However, the correlation between the indexes from the various methods is high, which implies that the ordinal ranking of firms according to their measured level of technical efficiency appears to be independent of the method used for a given year. By comparison, the correlation between efficiency indexes for the same method across time, although positive, is much lower than the previous set of correlations. Correlation analysis of efficiency versus farm size and of efficiency versus returns over variable costs, based on the alternative models, yielded consistent results.

Suggested Citation

  • B. E. Bravo‐Ureta & L. Rieger, 1990. "Alternative Production Frontier Methodologies And Dairy Farm Efficiency," Journal of Agricultural Economics, Wiley Blackwell, vol. 41(2), pages 215-226, May.
    • Handle: RePEc:bla:jageco:v:41:y:1990:i:2:p:215-226
    DOI: 10.1111/j.1477-9552.1990.tb00637.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1477-9552.1990.tb00637.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1477-9552.1990.tb00637.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Taylor, Timothy G. & Scott Shonkwiler, J., 1986. "Alternative stochastic specifications of the frontier production function in the analysis of agricultural credit programs and technical efficiency," Journal of Development Economics, Elsevier, vol. 21(1), pages 149-160, April.
    2. Forsund, Finn R. & Lovell, C. A. Knox & Schmidt, Peter, 1980. "A survey of frontier production functions and of their relationship to efficiency measurement," Journal of Econometrics, Elsevier, vol. 13(1), pages 5-25, May.
    3. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
    4. Battese, George E. & Coelli, Tim J., 1988. "Prediction of firm-level technical efficiencies with a generalized frontier production function and panel data," Journal of Econometrics, Elsevier, vol. 38(3), pages 387-399, July.
    5. P.J. Dawson & J. Lingard, 1982. "Management bias and returns to scale in a Cobb-Douglas production function for agriculture," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 9(1), pages 7-24.
    6. Greene, William H., 1980. "Maximum likelihood estimation of econometric frontier functions," Journal of Econometrics, Elsevier, vol. 13(1), pages 27-56, May.
    7. Boris E. Bravo-Ureta, 1986. "Technical Efficiency Measures for Dairy Farms Based on a Probabilistic Frontler Function Model," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 34(3), pages 399-415, November.
    8. Byrnes, Patricia, et al, 1987. "Technical Efficiency and Size: The Case of Illinois Grain Farms," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 14(4), pages 367-381.
    9. Grisley, William & Mascarenhas, Juan, . "Operating Cost Efficiency On Pennsylvania Dairy Farms," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 14(01), pages 1-8.
    10. Bagi, Faqir Singh, 1982. "Relationship Between Farm Size And Technical Efficiency In West Tennessee Agriculture," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 14(2), pages 1-6, December.
    11. Bagi, Faqir Singh, 1982. "Relationship Between Farm Size and Technical Efficiency in West Tennessee Agriculture," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 14(2), pages 139-144, December.
    12. Meeusen, Wim & van den Broeck, Julien, 1977. "Efficiency Estimation from Cobb-Douglas Production Functions with Composed Error," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(2), pages 435-444, June.
    13. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
    14. ZELLNER, Arnold & KMENTA, Jan & DREZE, Jacques H., 1966. "Specification and estimation of Cobb-Douglas production function models," LIDAM Reprints CORE 12, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    15. Timmer, C. Peter, 1970. "Front Matter & On Measuring Technical Efficiency," Food Research Institute Studies, Stanford University, Food Research Institute, vol. 9(2), pages 1-78.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Coelli, Tim J., 1995. "Recent Developments In Frontier Modelling And Efficiency Measurement," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 39(3), pages 1-27, December.
    2. Abdul Wadud, 2013. "Impact of Microcredit on Agricultural Farm Performance and Food Security in Bangladesh," Working Papers 14, Institute of Microfinance (InM).
    3. Bravo-Ureta, Boris E. & Rieger, Laszlo & Quiroga, Ricardo E., 1990. "Fixed Effects and Stochastic Frontier Estimates of Firm-Level Technical Efficiency," 1990 Annual meeting, August 5-8, Vancouver, Canada 270867, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Ahmad, Munir & Boris E., Bravo-Ureta, 1996. "Technical efficiency measures for dairy farms using panel data: a comparison of alternative model specifications," MPRA Paper 37703, University Library of Munich, Germany.
    5. Nguyen Khac Minh & Giang Thanh Long & Bach Ngoc Thang, 2007. "Technical Efficiency of Small And Medium Manufacturing Firms in Vietnam: Parametric and Non-Parametric Approaches," Korean Economic Review, Korean Economic Association, vol. 23, pages 187-221.
    6. Bravo-Ureta, Boris E. & Pinheiro, Antonio E., 1993. "Efficiency Analysis Of Developing Country Agriculture: A Review Of The Frontier Function Literature," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 22(01), pages 1-14, April.
    7. Schalk Hans Joachim & Untiedt Gerhard & Lüschow Jörg, 1995. "Technische Effizienz, Wachstum und Konvergenz in den Arbeitsmarktregionen der Bundesrepublik Deutschland (West). Eine ökonometrische Analyse für die Verarbeitende Industrie mit einem „Frontier Product," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 214(1), pages 25-49, February.
    8. Kevin Cullinane & Dong-Wook Song, 2003. "A stochastic frontier model of the productive efficiency of Korean container terminals," Applied Economics, Taylor & Francis Journals, vol. 35(3), pages 251-267.
    9. Boris Bravo-Ureta & Daniel Solís & Víctor Moreira López & José Maripani & Abdourahmane Thiam & Teodoro Rivas, 2007. "Technical efficiency in farming: a meta-regression analysis," Journal of Productivity Analysis, Springer, vol. 27(1), pages 57-72, February.
    10. Liu, Zinan & Zhuang, Juzhong, 2000. "Determinants of Technical Efficiency in Post-Collective Chinese Agriculture: Evidence from Farm-Level Data," Journal of Comparative Economics, Elsevier, vol. 28(3), pages 545-564, September.
    11. Nguyen Hung Anh & Wolfgang Bokelmann & Do Thi Nga & Nguyen Van Minh, 2019. "Toward Sustainability or Efficiency: The Case of Smallholder Coffee Farmers in Vietnam," Economies, MDPI, vol. 7(3), pages 1-25, July.
    12. Cullinane, Kevin & Song, Dong-Wook & Gray, Richard, 2002. "A stochastic frontier model of the efficiency of major container terminals in Asia: assessing the influence of administrative and ownership structures," Transportation Research Part A: Policy and Practice, Elsevier, vol. 36(8), pages 743-762, October.
    13. Shujie Yao & Zinan Liu, 1998. "Determinants of Grain Production and Technical Efficiency in China," Journal of Agricultural Economics, Wiley Blackwell, vol. 49(2), pages 171-184, June.
    14. Rawat, Pankaj S. & Sharma, Seema, 2021. "TFP growth, technical efficiency and catch-up dynamics: Evidence from Indian manufacturing," Economic Modelling, Elsevier, vol. 103(C).
    15. Jean-François Brun & Maïmouna Diakite, 2016. "Tax Potential and Tax Effort: An Empirical Estimation for Non-resource Tax Revenue and VAT’s Revenue," Working Papers halshs-01332053, HAL.
    16. Pantzios, Christos J. & Rozakis, Stelios & Tzouvelekas, Vangelis, 2006. "Evading Farm Support Reduction via Efficient Input Use: The Case of Greek Cotton Growers," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 38(3), pages 555-574, December.
    17. Christine Amsler & Michael Leonard & Peter Schmidt, 2013. "Estimation and inference in parametric deterministic frontier models," Journal of Productivity Analysis, Springer, vol. 40(3), pages 293-305, December.
    18. Keshari, Pradeep K & Paul, Thomas M, 1994. "Relative efficiency of foreign and domestic Banks," MPRA Paper 47072, University Library of Munich, Germany.
    19. Marc Baudry, 2005. "Les impôts locaux sont-ils gaspillés ?," Recherches économiques de Louvain, De Boeck Université, vol. 71(2), pages 143-173.
    20. Shunxiang Wu & Stephen Devadoss & Yaochi Lu, 2003. "Estimation and decomposition of technical efficiency for sugarbeet farms," Applied Economics, Taylor & Francis Journals, vol. 35(4), pages 471-484.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jageco:v:41:y:1990:i:2:p:215-226. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0021-857X .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.