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Efficiency and Merger Gains in The Danish Forestry Extension Service

Author

Listed:
  • Bogetoft, Peter
  • Strange, Niels
  • Thorsen, Bo Jellesmark

Abstract

In Denmark, many small-scale forest owners are affiliated to local district offices of The Danish Forestry Extension Service. Increasing economic pressure has caused a search for more efficiency in the Service, including potential reorganisation. In this paper, the efficiency of the different offices is evaluated using Data Envelopment Analysis (DEA) to approximate their production technology. Furthermore, recent theoretical developments in DEA-analysis are used to assess the gains from a number of potential mergers, and to decompose these gains into those from technological improvements, harmony effects and scale effects. It is found that technological inefficiency is the major source of inefficiency, mergers are only favoured through harmony gains, and for almost all potential mergers the scale effect seems absent or even negative.

Suggested Citation

  • Bogetoft, Peter & Strange, Niels & Thorsen, Bo Jellesmark, 2001. "Efficiency and Merger Gains in The Danish Forestry Extension Service," Unit of Economics Working Papers 24210, Royal Veterinary and Agricultural University, Food and Resource Economic Institute.
    • Handle: RePEc:ags:rvaewp:24210
    DOI: 10.22004/ag.econ.24210
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    Citations

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    Cited by:

    1. Lozano, S., 2013. "DEA production games," European Journal of Operational Research, Elsevier, vol. 231(2), pages 405-413.
    2. Shunsuke Managi, 2010. "Productivity measures and effects from subsidies and trade: an empirical analysis for Japan's forestry," Applied Economics, Taylor & Francis Journals, vol. 42(30), pages 3871-3883.
    3. T Joro & E-J Viitala, 2004. "Weight-restricted DEA in action: from expert opinions to mathematical models," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 55(8), pages 814-821, August.
    4. Peyrache, Antonio, 2013. "Industry structural inefficiency and potential gains from mergers and break-ups: A comprehensive approach," European Journal of Operational Research, Elsevier, vol. 230(2), pages 422-430.
    5. S Lozano & G Villa, 2010. "DEA-based pre-merger planning tool," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 61(10), pages 1485-1497, October.
    6. Andersen, Jesper Levring & Bogetoft, Peter, 2003. "Quota Trading and Profitability: Theoretical Models and Applications to Danish Fisheries," Unit of Economics Working Papers 24180, Royal Veterinary and Agricultural University, Food and Resource Economic Institute.
    7. Pierluigi Toma & Pier Paolo Miglietta & Domenico Morrone & Donatella Porrini, 2020. "Environmental risks and efficiency performances: The vulnerability of Italian forestry firms," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(6), pages 2793-2803, November.

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