IDEAS home Printed from https://ideas.repec.org/p/ags/eaae17/260902.html
   My bibliography  Save this paper

Effect Of Subsidies On Technical Efficiency Excluding Or Including Environmental Outputs: An Illustration With A Sample Of Farms In The European Union

Author

Listed:
  • Latruffe, Laure
  • Dakpo, K.Hervé
  • Desjeux, Yann
  • Justinia Hanitravelo, Giffona

Abstract

With a sample of farms in the European Union (EU) and Farm Accountancy Data Network (FADN) data completed by additionally collected data, we illustrate how the effect of farm subsidies on technical efficiency changes when environmental outputs are incorporated in the calculation of technical efficiency. Results indicate that the effect of the Common Agricultural Policy (CAP) operational subsidies on farm technical efficiency changes when environmental outputs (namely greenhouse gas emissions, nitrogen balance and ecological focus areas) are taken into account in the efficiency calculation: some effects change significance, and more importantly, some effects change sign.

Suggested Citation

  • Latruffe, Laure & Dakpo, K.Hervé & Desjeux, Yann & Justinia Hanitravelo, Giffona, 2017. "Effect Of Subsidies On Technical Efficiency Excluding Or Including Environmental Outputs: An Illustration With A Sample Of Farms In The European Union," 2017 International Congress, August 28-September 1, 2017, Parma, Italy 260902, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae17:260902
    DOI: 10.22004/ag.econ.260902
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/260902/files/Effect%20Of%20Subsidies%20On%20Technical%20Efficiency%20Excluding%20Or%20Including%20Environmental%20Outputs%3A%20An%20Illustration%20With%20A%20Sample%20Of%20Farms%20In%20The%20European%20Union.pdf
    Download Restriction: no
    File URL: https://ageconsearch.umn.edu/record/260902/files/Effect%20Of%20Subsidies%20On%20Technical%20Efficiency%20Excluding%20Or%20Including%20Environmental%20Outputs%3A%20An%20Illustration%20With%20A%20Sample%20Of%20Farms%20In%20The%20European%20Union.pdf?subformat=pdfa
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.260902?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
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Lansink, Alfons Oude & Reinhard, Stijn, 2004. "Investigating technical efficiency and potential technological change in Dutch pig farming," Agricultural Systems, Elsevier, vol. 79(3), pages 353-367, March.
    2. Laure Latruffe & Yann Desjeux & Zoltán Bakucs & Imre Fertő & József Fogarasi, 2013. "Environmental Pressures and Technical Efficiency of Pig Farms in Hungary," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 34(6), pages 409-416, September.
    3. Berre, David & Boussemart, Jean-Philippe & Leleu, Hervé & Tillard, Emmanuel, 2013. "Economic value of greenhouse gases and nitrogen surpluses: Society vs farmers’ valuation," European Journal of Operational Research, Elsevier, vol. 226(2), pages 325-331.
    4. Dakpo, K Hervé & Latruffe, Laure, 2016. "Agri-environmental subsidies and French suckler cow farms’ technical efficiency accounting for GHGs," Working Papers 245192, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    5. Minviel, Jean Joseph & De Witte, Kristof, 2017. "The influence of public subsidies on farm technical efficiency: A robust conditional nonparametric approach," European Journal of Operational Research, Elsevier, vol. 259(3), pages 1112-1120.
    6. Dakpo, K Hervé, 2016. "On modeling pollution-generating technologies: a new formulation of the by-production approach," Working Papers 245191, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    7. Jean Joseph Minviel & Laure Latruffe, 2017. "Effect of public subsidies on farm technical efficiency: a meta-analysis of empirical results," Applied Economics, Taylor & Francis Journals, vol. 49(2), pages 213-226, January.
    8. Martin, John P & Page, John M, Jr, 1983. "The Impact of Subsidies on X-Efficiency in LDC Industry: Theory and an Empirical Test," The Review of Economics and Statistics, MIT Press, vol. 65(4), pages 608-617, November.
    9. Chih‐Ching Yang & Ching‐Kai Hsiao & Ming‐Miin Yu, 2008. "Technical efficiency and impact of environmental regulations in farrow‐to‐finish swine production in Taiwan," Agricultural Economics, International Association of Agricultural Economists, vol. 39(1), pages 51-61, July.
    10. Teresa Serra & David Zilberman & José M. Gil, 2008. "Farms' technical inefficiencies in the presence of government programs ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 52(1), pages 57-76, March.
    11. 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.
    12. K Hervé Dakpo, 2016. "On modeling pollution-generating technologies: a new formulation of the by-production approach," Working Papers SMART 16-06, INRAE UMR SMART.
    13. Tim Coelli & Ludwig Lauwers & Guido Huylenbroeck, 2007. "Environmental efficiency measurement and the materials balance condition," Journal of Productivity Analysis, Springer, vol. 28(1), pages 3-12, October.
    14. Jeanneaux, Philippe & Latruffe, Laure, 2016. "Modelling pollution-generating technologies in performance benchmarking: Recent developments, limits and future prospects in the nonparametric frameworkAuthor-Name: Dakpo, K. Hervé," European Journal of Operational Research, Elsevier, vol. 250(2), pages 347-359.
    15. K Hervé Dakpo & Philippe Jeanneaux & Laure Latruffe, 2017. "Greenhouse gas emissions and efficiency in French sheep meat farming: A non-parametric framework of pollution-adjusted technologies," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 44(1), pages 33-65.
    16. Isabelle Piot-Lepetit & Monique Le Moing, 2007. "Productivity and environmental regulation : the effect of the nitrates directive in the French pig sector," Post-Print hal-02375148, HAL.
    17. Eric Njuki & Boris E. Bravo-Ureta, 2015. "The Economic Costs of Environmental Regulation in U.S. Dairy Farming: A Directional Distance Function Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 97(4), pages 1087-1106.
    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. Dakpo, Hervé K & Jeanneaux, Philippe & Latruffe, Laure, 2014. "Inclusion of undesirable outputs in production technology modeling: The case of greenhouse gas emissions in French meat sheep farming," Working Papers 207806, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    2. Dakpo, K Hervé & Lansink, Alfons Oude, 2019. "Dynamic pollution-adjusted inefficiency under the by-production of bad outputs," European Journal of Operational Research, Elsevier, vol. 276(1), pages 202-211.
    3. Aparicio, Juan & Kapelko, Magdalena & Zofío, José L., 2020. "The measurement of environmental economic inefficiency with pollution-generating technologies," Resource and Energy Economics, Elsevier, vol. 62(C).
    4. Dakpo, K Hervé & Latruffe, Laure, 2016. "Agri-environmental subsidies and French suckler cow farms’ technical efficiency accounting for GHGs," Working Papers 245192, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    5. Abad, Arnaud & Briec, Walter, 2019. "On the axiomatic of pollution-generating technologies: Non-parametric production analysis," European Journal of Operational Research, Elsevier, vol. 277(1), pages 377-390.
    6. Andreas Eder, 2022. "Environmental efficiency measurement when producers control pollutants under heterogeneous conditions: a generalization of the materials balance approach," Journal of Productivity Analysis, Springer, vol. 57(2), pages 157-176, April.
    7. Andreas Eder, 2021. "Environmental efficiency measurement when producers control pollutants under heterogeneous conditions: a generalization of the materials balance approach," Working Papers 752021, University of Natural Resources and Life Sciences, Vienna, Department of Economics and Social Sciences, Institute for Sustainable Economic Development.
    8. David Hadley & Euan Fleming & Renato Villano, 2013. "Is Input Mix Inefficiency Neglected in Agriculture? A Case Study of Pig-based Farming Systems in England and Wales," Journal of Agricultural Economics, Wiley Blackwell, vol. 64(2), pages 505-515, June.
    9. repec:zbw:inwedp:752021 is not listed on IDEAS
    10. Latruffe, Laure & Desjeux, Yann & Fogarasi, Jozsef & Bakucs, Lajos Zoltan & Ferto, Imre, 2010. "Technical efficiency and environmental pressures of pig farms in Hungary," 120th Seminar, September 2-4, 2010, Chania, Crete 109385, European Association of Agricultural Economists.
    11. Jeanneaux, Philippe & Latruffe, Laure, 2016. "Modelling pollution-generating technologies in performance benchmarking: Recent developments, limits and future prospects in the nonparametric frameworkAuthor-Name: Dakpo, K. Hervé," European Journal of Operational Research, Elsevier, vol. 250(2), pages 347-359.
    12. K. Hervé Dakpo & Yann Desjeux & Laure Latruffe, 2023. "Cost of abating excess nitrogen on wheat plots in France: An assessment with multi‐technology modelling," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(3), pages 800-815, September.
    13. Engida, Tadesse Getacher & Rao, Xudong & Oude Lansink, Alfons G.J.M., 2020. "A dynamic by-production framework for analyzing inefficiency associated with corporate social responsibility," European Journal of Operational Research, Elsevier, vol. 287(3), pages 1170-1179.
    14. Hoang, Viet-Ngu & Rao, D.S. Prasada, 2010. "Measuring and decomposing sustainable efficiency in agricultural production: A cumulative exergy balance approach," Ecological Economics, Elsevier, vol. 69(9), pages 1765-1776, July.
    15. Dakpo, K Hervé, 2016. "On modeling pollution-generating technologies: a new formulation of the by-production approach," Working Papers 245191, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    16. Zhou, Haibo & Yang, Yi & Chen, Yao & Zhu, Joe, 2018. "Data envelopment analysis application in sustainability: The origins, development and future directions," European Journal of Operational Research, Elsevier, vol. 264(1), pages 1-16.
    17. Zdeňka Náglová & Marie Šimpachová Pechrová, 2019. "Subsidies and technical efficiency of Czech food processing industry," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 65(4), pages 151-159.
    18. Arjomandi, Amir & Dakpo, K. Hervé & Seufert, Juergen Heinz, 2018. "Have Asian airlines caught up with European Airlines? A by-production efficiency analysis," Transportation Research Part A: Policy and Practice, Elsevier, vol. 116(C), pages 389-403.
    19. Zhong, Shen & Li, Junwei & Chen, Xi & Wen, Hongmei, 2022. "A multi-hierarchy meta-frontier approach for measuring green total factor productivity: An application of pig breeding in China," Socio-Economic Planning Sciences, Elsevier, vol. 81(C).
    20. Luca Romagnoli & Vincenzo Giaccio & Luigi Mastronardi & Maria Bonaventura Forleo, 2021. "Highlighting the Drivers of Italian Diversified Farms Efficiency: A Two-Stage DEA-Panel Tobit Analysis," Sustainability, MDPI, vol. 13(23), pages 1-16, November.
    21. Basurto Hernandez, Saul & Maddison, David & Banerjee, Anindya, 2018. "The effect of PROCAMPO on farms’ technical efficiency: A Stochastic Frontier Analysis," 2018 Annual Meeting, August 5-7, Washington, D.C. 274376, Agricultural and Applied Economics Association.

    More about this item

    Keywords

    Production Economics;

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:ags:eaae17:260902. 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: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/eaaeeea.html .

    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.