IDEAS home Printed from https://ideas.repec.org/a/caa/jnlage/v68y2022i1id384-2021-agricecon.html
   My bibliography  Save this article

Productivity and efficiency in Czech agriculture: Does farm size matter?

Author

Listed:
  • Lukáš Čechura

    (Department of Economics, Faculty of Economics and Management, Czech University of Life Sciences Prague, Prague, Czech Republic)

  • Zdeňka Žáková Kroupová

    (Department of Economics, Faculty of Economics and Management, Czech University of Life Sciences Prague, Prague, Czech Republic)

  • Michaela Lekešová

    (Institute of Agricultural Economics and Information, Prague, Czech Republic)

Abstract

This paper deals with the sources of total factor productivity (TFP), namely technical efficiency, scale efficiency, and technological change, considering the size of agricultural producers and using balanced panel data in the period 2014-2018 drawn from the Farm Accountancy Data Network (FADN) database for three sectors of Czech agriculture - cereals, milk, and beef. The investigation is based on the stochastic frontier (SF) modelling of an input distance function (IDF) with four error components (heterogeneity, statistical noise, persistent and transient inefficiency). The sector-specific models are estimated by a four-step estimating procedure with a system generalised method of moments (GMM) estimator to address the endogeneity problem. The results reveal inter- and intra-sectoral differences in productivity drivers. In particular, the smallest producers lag considerably behind the largest ones due to the scale effect (SEC). While large farms should focus on technological change, improvements in scale and technical efficiency have been identified as the main sources of coping with productivity losses for small farmers.

Suggested Citation

  • Lukáš Čechura & Zdeňka Žáková Kroupová & Michaela Lekešová, 2022. "Productivity and efficiency in Czech agriculture: Does farm size matter?," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 68(1), pages 1-10.
    • Handle: RePEc:caa:jnlage:v:68:y:2022:i:1:id:384-2021-agricecon
    DOI: 10.17221/384/2021-AGRICECON
    as

    Download full text from publisher

    File URL: http://agricecon.agriculturejournals.cz/doi/10.17221/384/2021-AGRICECON.html
    Download Restriction: free of charge
    File URL: http://agricecon.agriculturejournals.cz/doi/10.17221/384/2021-AGRICECON.pdf
    Download Restriction: free of charge
    File URL: https://libkey.io/10.17221/384/2021-AGRICECON?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-1054, July.
    2. Alvarez, Antonio & Arias, Carlos, 2004. "Technical efficiency and farm size: a conditional analysis," Agricultural Economics, Blackwell, vol. 30(3), pages 241-250, May.
    3. Rada, Nicholas E. & Fuglie, Keith O., 2019. "New perspectives on farm size and productivity," Food Policy, Elsevier, vol. 84(C), pages 147-152.
    4. Key, Nigel, 2019. "Farm size and productivity growth in the United States Corn Belt," Food Policy, Elsevier, vol. 84(C), pages 186-195.
    5. David Roodman, 2009. "How to do xtabond2: An introduction to difference and system GMM in Stata," Stata Journal, StataCorp LP, vol. 9(1), pages 86-136, March.
    6. Caves, Douglas W & Christensen, Laurits R & Diewert, W Erwin, 1982. "The Economic Theory of Index Numbers and the Measurement of Input, Output, and Productivity," Econometrica, Econometric Society, vol. 50(6), pages 1393-1414, November.
    7. Kumbhakar,Subal C. & Wang,Hung-Jen & Horncastle,Alan P., 2015. "A Practitioner's Guide to Stochastic Frontier Analysis Using Stata," Cambridge Books, Cambridge University Press, number 9781107609464, September.
    8. Greene, William, 2005. "Reconsidering heterogeneity in panel data estimators of the stochastic frontier model," Journal of Econometrics, Elsevier, vol. 126(2), pages 269-303, June.
    9. Tamara Rudinskaya & Tomas Hlavsa & Martin Hruska, 2019. "Estimation of technical efficiency of Czech farms operating in less favoured areas," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 65(10), pages 445-453.
    10. G. Page West III & Julio DeCastro, 2001. "The Achilles Heel of Firm Strategy: Resource Weaknesses and Distinctive Inadequacies," Journal of Management Studies, Wiley Blackwell, vol. 38(3), pages 417-442, May.
    11. 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.
    12. Mehdi Farsi & Massimo Filippini & Michael Kuenzle, 2005. "Unobserved heterogeneity in stochastic cost frontier models: an application to Swiss nursing homes," Applied Economics, Taylor & Francis Journals, vol. 37(18), pages 2127-2141.
    13. Diewert, W. E., 1976. "Exact and superlative index numbers," Journal of Econometrics, Elsevier, vol. 4(2), pages 115-145, May.
    14. Man, Thomas W. Y. & Lau, Theresa & Chan, K. F., 2002. "The competitiveness of small and medium enterprises: A conceptualization with focus on entrepreneurial competencies," Journal of Business Venturing, Elsevier, vol. 17(2), pages 123-142, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Thi Long Vy Le & Truong Lam Do & Huu Nhuan Nguyen & Trung Thanh Nguyen, 2023. "Farmland accumulation and rural household income: evidence from the Red River Delta region of Vietnam," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 69(11), pages 458-469.

    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. Lukáš Čechura & Zdeňka Žáková Kroupová & Irena Benešová, 2021. "Productivity and Efficiency in European Milk Production: Can We Observe the Effects of Abolishing Milk Quotas?," Agriculture, MDPI, vol. 11(9), pages 1-21, August.
    2. Lukáš Čechura & Zdeňka Žáková Kroupová, 2021. "Technical Efficiency in the European Dairy Industry: Can We Observe Systematic Failures in the Efficiency of Input Use?," Sustainability, MDPI, vol. 13(4), pages 1-19, February.
    3. Pontus Mattsson & Jonas Mansson & William H. Greene, 2018. "TFP Change and its Components for Swedish Manufacturing Firms During the 2008-2009 Financial Crisis," Working Papers 18-27, New York University, Leonard N. Stern School of Business, Department of Economics.
    4. Andrew P. Barnes, 2023. "The role of family life‐cycle events on persistent and transient inefficiencies in less favoured areas," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(1), pages 295-315, February.
    5. Manuel Llorca & José Baños & José Somoza & Pelayo Arbués, 2017. "A Stochastic Frontier Analysis Approach for Estimating Energy Demand and Efficiency in the Transport Sector of Latin America and the Caribbean," The Energy Journal, International Association for Energy Economics, vol. 0(Number 5).
    6. Llorca, Manuel & Baños, José & Somoza, José & Arbués, Pelayo, 2014. "A latent class approach for estimating energy demands and efficiency in transport: An application to Latin America and the Caribbean," Efficiency Series Papers 2014/04, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    7. Sami Jarboui, 2022. "Operational and environmental efficiency of U.S. oil and gas companies towards energy transition policies: A comparative empirical analysis," Australian Economic Papers, Wiley Blackwell, vol. 61(2), pages 234-257, June.
    8. Pontus Mattsson & Jonas Månsson & William H. Greene, 2020. "TFP change and its components for Swedish manufacturing firms during the 2008–2009 financial crisis," Journal of Productivity Analysis, Springer, vol. 53(1), pages 79-93, February.
    9. Xie, Bai-Chen & Ni, Kang-Kang & O'Neill, Eoghan & Li, Hong-Zhou, 2021. "The scale effect in China's power grid sector from the perspective of malmquist total factor productivity analysis," Utilities Policy, Elsevier, vol. 69(C).
    10. Castiglione, Concetta & Infante, Davide & Zieba, Marta, 2024. "Is it worth subsidising the cultural sector? New insights from Italian theatre companies," Journal of Policy Modeling, Elsevier, vol. 46(1), pages 20-38.
    11. Raushan Bokusheva & Lukáš Čechura & Subal C. Kumbhakar, 2023. "Estimating persistent and transient technical efficiency and their determinants in the presence of heterogeneity and endogeneity," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(2), pages 450-472, June.
    12. repec:use:tkiwps:3232 is not listed on IDEAS
    13. Sabrina Auci & Laura Castellucci & Manuela Coromaldi, 2021. "How does public spending affect technical efficiency? Some evidence from 15 European countries," Bulletin of Economic Research, Wiley Blackwell, vol. 73(1), pages 108-130, January.
    14. Zhang, Lin, 2017. "Correcting the uneven burden sharing of emission reduction across provinces in China," Energy Economics, Elsevier, vol. 64(C), pages 335-345.
    15. Cazals Catherine & Dudley Paul & Florens Jean-Pierre & Jones Michael, 2011. "The Effect of Unobserved Heterogeneity in Stochastic Frontier Estimation: Comparison of Cross Section and Panel with Simulated Data for the Postal Sector," Review of Network Economics, De Gruyter, vol. 10(3), pages 1-22, September.
    16. Castiglione, Concetta & Infante, Davide & Zieba, Marta, 2023. "Public support for performing arts. Efficiency and productivity gains in eleven European countries," Socio-Economic Planning Sciences, Elsevier, vol. 85(C).
    17. Federico Belotti & Silvio Daidone & Giuseppe Ilardi & Vincenzo Atella, 2013. "Stochastic frontier analysis using Stata," Stata Journal, StataCorp LP, vol. 13(4), pages 718-758, December.
    18. Farsi, Mehdi & Filippini, Massimo, 2009. "An analysis of cost efficiency in Swiss multi-utilities," Energy Economics, Elsevier, vol. 31(2), pages 306-315, March.
    19. Dorgyles C.M. Kouakou, 2022. "Separating innovation short-run and long-run technical efficiencies: Evidence from the Economic Community of West African States (ECOWAS)," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 19(1), pages 103-141, June.
    20. Ablam Estel APETI & Bao-We-Wal BAMBE & Jean Louis COMBES, 2022. "On the Macroeconomic Effects of Fiscal Reforms : Fiscal Rules and Public Expenditure Efficiency," LEO Working Papers / DR LEO 2985, Orleans Economics Laboratory / Laboratoire d'Economie d'Orleans (LEO), University of Orleans.
    21. Thomas Triebs & Subal C. Kumbhakar, 2012. "Management Practice in Production," ifo Working Paper Series 129, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.

    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:caa:jnlage:v:68:y:2022:i:1:id:384-2021-agricecon. 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: Ivo Andrle (email available below). General contact details of provider: https://www.cazv.cz/en/home/ .

    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.