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How "efficient" are dairy farms in mountain areas?

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  • Ortner, Karl 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 “overall” and “firm-level” efficiency. 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.

Suggested Citation

  • Ortner, Karl M., 2008. "How "efficient" are dairy farms in mountain areas?," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44371, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae08:44371
    DOI: 10.22004/ag.econ.44371
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    References listed on IDEAS

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    1. Leopold Simar & Paul Wilson, 2000. "A general methodology for bootstrapping in non-parametric frontier models," Journal of Applied Statistics, Taylor & Francis Journals, vol. 27(6), pages 779-802.
    2. Léopold Simar & Paul Wilson, 2000. "Statistical Inference in Nonparametric Frontier Models: The State of the Art," Journal of Productivity Analysis, Springer, vol. 13(1), pages 49-78, January.
    3. 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.
    4. 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.
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    Keywords

    Farm Management; Livestock Production/Industries;

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