IDEAS home Printed from https://ideas.repec.org/a/spr/operea/v20y2020i4d10.1007_s12351-018-0429-7.html
   My bibliography  Save this article

Accounting for rainfall and the length of growing season in technical efficiency analysis

Author

Listed:
  • Yiorgos Gadanakis

    (University of Reading)

  • Francisco José Areal

    (University of Reading)

Abstract

The physical environment of farming systems is rarely considered when conducting farm level efficiency analysis, which is likely to lead to bias of performance measurements based on benchmarking methods such as Data Envelopment Analysis (DEA). We incorporate variations of the physical environment (rainfall and length of growing season) through the specifications of the linear programming in DEA to investigate performance measurement bias. The derived technical efficiency estimates are obtained using a sub-vector DEA which ensures farms are compared in a homogenous environment (i.e. accounting for differences in rainfall levels amongst distinct farm units). We use the Farm Business Survey to analyse a representative sample of 245 cereal farms in the East Anglia region between 2009 and 2010. Efficiency rankings obtained from a standard DEA model and a non-discretionary DEA model that incorporates the variations in the physical environment. We show that incorporating rainfall and the length of the growing season as non-discretionary inputs into the production function had significantly altered the farm efficiency ranking between the two models. Hence, to improve extension services to farmers and to reduce biased estimates of farm technical efficiency, variations in environmental conditions need to be integral to the analysis of efficiency.

Suggested Citation

  • Yiorgos Gadanakis & Francisco José Areal, 2020. "Accounting for rainfall and the length of growing season in technical efficiency analysis," Operational Research, Springer, vol. 20(4), pages 2583-2608, December.
    • Handle: RePEc:spr:operea:v:20:y:2020:i:4:d:10.1007_s12351-018-0429-7
    DOI: 10.1007/s12351-018-0429-7
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s12351-018-0429-7
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s12351-018-0429-7?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. Alexandra Schmidt & Ajax Moreira & Steven Helfand & Thais Fonseca, 2009. "Spatial stochastic frontier models: accounting for unobserved local determinants of inefficiency," Journal of Productivity Analysis, Springer, vol. 31(2), pages 101-112, April.
    2. Kopp, Raymond J., 1981. "Measuring the technical efficiency of production: A comment," Journal of Economic Theory, Elsevier, vol. 25(3), pages 450-452, December.
    3. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    4. Vidoli, Francesco & Canello, Jacopo, 2016. "Controlling for spatial heterogeneity in nonparametric efficiency models: An empirical proposal," European Journal of Operational Research, Elsevier, vol. 249(2), pages 771-783.
    5. Francisco José Areal & Kelvin Balcombe & Richard Tiffin, 2012. "Integrating spatial dependence into Stochastic Frontier Analysis," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(4), pages 521-541, October.
    6. Lavado, Rouselle F. & Barrios, Erniel B., 2010. "Spatial Stochastic Frontier Models," Discussion Papers DP 2010-08, Philippine Institute for Development Studies.
    7. Cinzia Daraio & Léopold Simar, 2007. "Conditional nonparametric frontier models for convex and nonconvex technologies: a unifying approach," Journal of Productivity Analysis, Springer, vol. 28(1), pages 13-32, October.
    8. Léopold Simar & Paul W. Wilson, 1998. "Sensitivity Analysis of Efficiency Scores: How to Bootstrap in Nonparametric Frontier Models," Management Science, INFORMS, vol. 44(1), pages 49-61, January.
    9. Glass, Anthony J. & Kenjegalieva, Karligash & Sickles, Robin C., 2016. "A spatial autoregressive stochastic frontier model for panel data with asymmetric efficiency spillovers," Journal of Econometrics, Elsevier, vol. 190(2), pages 289-300.
    10. Henderson, Benjamin B. & Kingwell, Ross S., 2005. "Rainfall and Farm Efficiency Measurement for Broadacre Agriculture in South-Western Australia," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 13.
    11. Alexander Gocht & Kelvin Balcombe, 2006. "Ranking efficiency units in DEA using bootstrapping an applied analysis for Slovenian farm data," Agricultural Economics, International Association of Agricultural Economists, vol. 35(2), pages 223-229, September.
    12. Sherlund, Shane M. & Barrett, Christopher B. & Adesina, Akinwumi A., 2002. "Smallholder technical efficiency controlling for environmental production conditions," Journal of Development Economics, Elsevier, vol. 69(1), pages 85-101, October.
    13. Areal, Francisco Jose & Balcombe, Kelvin & Tiffin, Richard, 2012. "Integrated spatial dependence into Stochastic Frontier Analysis," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(4), pages 1-21, December.
    14. Olayide, Olawale Emmanuel & Tetteh, Isaac Kow & Popoola, Labode, 2016. "Differential impacts of rainfall and irrigation on agricultural production in Nigeria: Any lessons for climate-smart agriculture?," Agricultural Water Management, Elsevier, vol. 178(C), pages 30-36.
    15. Bădin, Luiza & Daraio, Cinzia & Simar, Léopold, 2012. "How to measure the impact of environmental factors in a nonparametric production model," European Journal of Operational Research, Elsevier, vol. 223(3), pages 818-833.
    16. Anselin, Luc, 2002. "Under the hood : Issues in the specification and interpretation of spatial regression models," Agricultural Economics, Blackwell, vol. 27(3), pages 247-267, November.
    17. Valerien O. Pede & Francisco J. Areal & Alphonse Singbo & Justin McKinley & Kei Kajisa, 2018. "Spatial dependency and technical efficiency: an application of a Bayesian stochastic frontier model to irrigated and rainfed rice farmers in Bohol, Philippines," Agricultural Economics, International Association of Agricultural Economists, vol. 49(3), pages 301-312, May.
    18. M. Simona Andreano & Roberto Benedetti & Paolo Postiglione, 2017. "Spatial regimes in regional European growth: an iterated spatially weighted regression approach," Quality & Quantity: International Journal of Methodology, Springer, vol. 51(6), pages 2665-2684, November.
    19. Morakinyo Adetutu & Anthony Glass & Karligash Kenjegalieva & Robin Sickles, 2015. "The effects of efficiency and TFP growth on pollution in Europe: a multistage spatial analysis," Journal of Productivity Analysis, Springer, vol. 43(3), pages 307-326, June.
    20. Rajiv D. Banker, 1993. "Maximum Likelihood, Consistency and Data Envelopment Analysis: A Statistical Foundation," Management Science, INFORMS, vol. 39(10), pages 1265-1273, October.
    21. Isabelle Piot-Lepetit & Dominique Vermersch & Robert Weaver, 1997. "Agriculture's environmental externalities: DEA evidence for French agriculture," Applied Economics, Taylor & Francis Journals, vol. 29(3), pages 331-338.
    22. Glass, Anthony & Kenjegalieva, Karligash & Sickles, Robin C., 2014. "Estimating efficiency spillovers with state level evidence for manufacturing in the US," Economics Letters, Elsevier, vol. 123(2), pages 154-159.
    23. Hughes, Neal & Lawson, Kenton & Davidson, Alistair & Jackson, Tom & Sheng, Yu, 2011. "Productivity pathways: climate-adjusted production frontiers for the Australian broadacre cropping industry," 2011 Conference (55th), February 8-11, 2011, Melbourne, Australia 100563, Australian Agricultural and Resource Economics Society.
    24. Kneip, Alois & Park, Byeong U. & Simar, Léopold, 1998. "A Note On The Convergence Of Nonparametric Dea Estimators For Production Efficiency Scores," Econometric Theory, Cambridge University Press, vol. 14(6), pages 783-793, December.
    25. Simar, Leopold & Wilson, Paul W., 2007. "Estimation and inference in two-stage, semi-parametric models of production processes," Journal of Econometrics, Elsevier, vol. 136(1), pages 31-64, January.
    26. Gil, Guilherme Dôco Roberti & Costa, Marcelo Azevedo & Lopes, Ana Lúcia Miranda & Mayrink, Vinícius Diniz, 2017. "Spatial statistical methods applied to the 2015 Brazilian energy distribution benchmarking model: Accounting for unobserved determinants of inefficiencies," Energy Economics, Elsevier, vol. 64(C), pages 373-383.
    27. Seok-Oh Jeong & Byeong Park & Léopold Simar, 2010. "Nonparametric conditional efficiency measures: asymptotic properties," Annals of Operations Research, Springer, vol. 173(1), pages 105-122, January.
    28. Vidoli, Francesco & Cardillo, Concetta & Fusco, Elisa & Canello, Jacopo, 2016. "Spatial nonstationarity in the stochastic frontier model: An application to the Italian wine industry," Regional Science and Urban Economics, Elsevier, vol. 61(C), pages 153-164.
    29. Korostelev, A. P. & Simar, L. & Tsybakov, A. B., 1995. "Estimation of monotone boundaries," LIDAM Reprints CORE 1178, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    30. Lilienfeld, Amy & Asmild, Mette, 2007. "Estimation of excess water use in irrigated agriculture: A Data Envelopment Analysis approach," Agricultural Water Management, Elsevier, vol. 94(1-3), pages 73-82, December.
    31. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    32. A. G. Billé & C. Salvioni & R. Benedetti, 2018. "Modelling spatial regimes in farms technologies," Journal of Productivity Analysis, Springer, vol. 49(2), pages 173-185, June.
    33. William W. Cooper & Lawrence M. Seiford & Kaoru Tone, 2007. "Data Envelopment Analysis," Springer Books, Springer, edition 0, number 978-0-387-45283-8, October.
    34. Mette Asmild & Jens Leth Hougaard, 2006. "Economic versus environmental improvement potentials of Danish pig farms," Agricultural Economics, International Association of Agricultural Economists, vol. 35(2), pages 171-181, September.
    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. Maria Martinez Cillero & Miguel Tovar Reaños, 2023. "Farm technical and environmental efficiency and subsidy redistribution in Ireland: A simulation approach of possible performance and equity effects," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(2), pages 394-412, June.
    2. Liu, Yujie & Bachofen, Christoph & Wittwer, Raphaël & Silva Duarte, Gicele & Sun, Qing & Klaus, Valentin H. & Buchmann, Nina, 2022. "Using PhenoCams to track crop phenology and explain the effects of different cropping systems on yield," Agricultural Systems, Elsevier, vol. 195(C).
    3. Nguyen-Anh, Tuan & Hoang-Duc, Chinh & Tiet, Tuyen & Nguyen-Van, Phu & To-The, Nguyen, 2022. "Composite effects of human, natural and social capitals on sustainable food-crop farming in Sub-Saharan Africa," Food Policy, Elsevier, vol. 113(C).
    4. K. Kounetas & G. Androulakis & M. Kaisari & G. Manousakis, 2023. "Educational reforms and secondary school's efficiency performance in Greece: a bootstrap DEA and multilevel approach," Operational Research, Springer, vol. 23(1), pages 1-29, March.

    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. Kassoum Ayouba, 2023. "Spatial dependence in production frontier models," Journal of Productivity Analysis, Springer, vol. 60(1), pages 21-36, August.
    2. Vidoli, Francesco & Cardillo, Concetta & Fusco, Elisa & Canello, Jacopo, 2016. "Spatial nonstationarity in the stochastic frontier model: An application to the Italian wine industry," Regional Science and Urban Economics, Elsevier, vol. 61(C), pages 153-164.
    3. Adjin, K. Christophe & Henning, Christian H. C. A., 2020. "Climate variability and farm inefficiency: A spatial stochastic frontier analysis of Senegalese agriculture," Working Papers of Agricultural Policy WP2020-09, University of Kiel, Department of Agricultural Economics, Chair of Agricultural Policy.
    4. Valentin Zelenyuk, 2019. "Data Envelopment Analysis and Business Analytics: The Big Data Challenges and Some Solutions," CEPA Working Papers Series WP072019, School of Economics, University of Queensland, Australia.
    5. A. G. Billé & C. Salvioni & R. Benedetti, 2018. "Modelling spatial regimes in farms technologies," Journal of Productivity Analysis, Springer, vol. 49(2), pages 173-185, June.
    6. Vidoli, Francesco & Canello, Jacopo, 2016. "Controlling for spatial heterogeneity in nonparametric efficiency models: An empirical proposal," European Journal of Operational Research, Elsevier, vol. 249(2), pages 771-783.
    7. Léopold Simar & Paul W. Wilson, 2015. "Statistical Approaches for Non-parametric Frontier Models: A Guided Tour," International Statistical Review, International Statistical Institute, vol. 83(1), pages 77-110, April.
    8. Bergantino, Angela Stefania & Intini, Mario & Volta, Nicola, 2020. "Spatial competition and efficiency: an investigation in the airport sector," The Warwick Economics Research Paper Series (TWERPS) 1287, University of Warwick, Department of Economics.
    9. Theodoros Skevas & Jasper Grashuis, 2020. "Technical efficiency and spatial spillovers: Evidence from grain marketing cooperatives in the US Midwest," Agribusiness, John Wiley & Sons, Ltd., vol. 36(1), pages 111-126, January.
    10. Olesen, Ole B. & Petersen, Niels Christian, 2016. "Stochastic Data Envelopment Analysis—A review," European Journal of Operational Research, Elsevier, vol. 251(1), pages 2-21.
    11. Jacopo Canello & Francesco Vidoli, 2020. "Investigating space‐time patterns of regional industrial resilience through a micro‐level approach: An application to the Italian wine industry," Journal of Regional Science, Wiley Blackwell, vol. 60(4), pages 653-676, September.
    12. Bergantino, Angela Stefania & Intini, Mario & Volta, Nicola, 2021. "The spatial dimension of competition among airports at the worldwide level: a spatial stochastic frontier analysis," European Journal of Operational Research, Elsevier, vol. 295(1), pages 118-130.
    13. Fei Jin & Lung-fei Lee, 2020. "Asymptotic properties of a spatial autoregressive stochastic frontier model," Journal of Spatial Econometrics, Springer, vol. 1(1), pages 1-40, December.
    14. Gounopoulos, Dimitrios & Kallias, Konstantinos & Newton, David & Tzeremes, Nickolaos, 2016. "Political connections and IPO underpricing: An efficiency problem," MPRA Paper 69427, University Library of Munich, Germany.
    15. Orea, Luis & Álvarez, Inmaculada C., 2019. "Spatial Production Economics," Efficiency Series Papers 2019/06, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    16. Fusco, Elisa & Vidoli, Francesco & Sahoo, Biresh K., 2018. "Spatial heterogeneity in composite indicator: A methodological proposal," Omega, Elsevier, vol. 77(C), pages 1-14.
    17. José Solana‐Ibáñez & Manuel Caravaca‐Garratón, 2021. "Stakeholder engagement and corporate social reputation: The influence of exogenous factors on efficiency performance (stakeholder engagement and exogenous factors): Stakeholder engagement and exogenou," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(6), pages 1891-1905, November.
    18. Fusco, Elisa & Allegrini, Veronica, 2020. "The role of spatial interdependence in local government cost efficiency: An application to waste Italian sector," Socio-Economic Planning Sciences, Elsevier, vol. 69(C).
    19. Amir Moradi-Motlagh & Ali Emrouznejad, 2022. "The origins and development of statistical approaches in non-parametric frontier models: a survey of the first two decades of scholarly literature (1998–2020)," Annals of Operations Research, Springer, vol. 318(1), pages 713-741, November.
    20. Halkos, George & Tzeremes, Nickolaos, 2011. "A conditional full frontier modelling for analyzing environmental efficiency and economic growth," MPRA Paper 32839, University Library of Munich, Germany.

    More about this item

    Keywords

    Technical efficiency; DEA; Agriculture; Bootstrap; Physical environment;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture

    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:spr:operea:v:20:y:2020:i:4:d:10.1007_s12351-018-0429-7. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.