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Technical efficiency and conversion to organic farming: the case of France

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  • Laure Latruffe
  • Céline Nauges

Abstract

Using a panel of French crop farms, we test whether farmers’ technical efficiency under conventional practices is a significant driver of conversion to organic farming. An important issue is whether subsidies to organic farming could encourage inefficient farmers to convert. We find that the probability of conversion does depend on technical efficiency preceding the conversion, but that the direction of the effect depends on farm size. This result is found to be robust to the method of calculation of efficiency scores, either parametric or non-parametric. This study also confirms that farm’s characteristics impact the probability of conversion to organic farming.

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  • Laure Latruffe & Céline Nauges, 2010. "Technical efficiency and conversion to organic farming: the case of France," Working Papers SMART 10-17, INRAE UMR SMART.
    • Handle: RePEc:rae:wpaper:201017
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    File URL: http://www6.rennes.inra.fr/smart/Media/Working-papers/WP10-17
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    4. Djokoto, Justice Gameli & Afari-Sefa, Victor, 2017. "Alternative functional forms for technology choice: Application to cocoa production technologies," Technology in Society, Elsevier, vol. 50(C), pages 110-120.
    5. Boris E. Bravo‐Ureta & Víctor H. Moreira & Javier L. Troncoso & Alan Wall, 2020. "Plot‐level technical efficiency accounting for farm‐level effects: Evidence from Chilean wine grape producers," Agricultural Economics, International Association of Agricultural Economists, vol. 51(6), pages 811-824, November.
    6. Elodie Letort & Aude Ridier, 2022. "The economic performance of transitional and non-transitional organic dairy farms: A panel data econometric approach in Brittany [Les performances économiques des exploitations laitières en agricul," Working Papers hal-03635268, HAL.
    7. Laure Latruffe & Andreas Niedermayr & Yann Desjeux & K Herve Dakpo & Kassoum Ayouba & Lena Schaller & Jochen Kantelhardt & Yan Jin & Kevin Kilcline & Mary Ryan & Cathal O’Donoghue, 2023. "Identifying and assessing intensive and extensive technologies in European dairy farming," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 50(4), pages 1482-1519.
    8. Cechura, L. & Hockmann, H. & Malý, M. & Žáková Kroupová, Z., 2015. "Comparison of Technology and Technical Efficiency in Cereal Production among EU Countries," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 7(2), pages 1-11, June.
    9. Djokoto, Justice G., 2015. "Technical efficiency of organic agriculture: a quantitative review," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 117(2), pages 1-11, August.
    10. S. C. West & A. W. Mugera & R. S. Kingwell, 2022. "The choice of efficiency benchmarking metric in evaluating firm productivity and viability," Journal of Productivity Analysis, Springer, vol. 57(2), pages 193-211, April.
    11. Galluzzo, Nicola, 2017. "Technical and economic efficiency in some Italian farms: an analysis in two Italian islands," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 0(Issue 2), July.
    12. Nicola GALLUZZO, 2023. "An Analysis Of Crop Costs In Italian Nitrate Vulnerable Areas And Agri-Environmental Subsidies," Agricultural Economics and Rural Development, Institute of Agricultural Economics, vol. 20(1), pages 15-28.
    13. Cechura, Lukas & Hockmann, Heinrich & Malý, Michal & Žáková Kroupová, Zdenka, 2015. "Comparison of technology and technical efficiency in cereal production among EU countries," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 7(2), pages 27-37.
    14. Chantal Gascuel & Michèle Tixier-Boichard & Benoit Dedieu & Cécile Détang-Dessendre & Pierre Dupraz & Philippe Faverdin & Laurent Hazard & Philippe Hinsinger & Isabelle Litrico-Chiarelli & Françoise M, 2019. "Réflexion prospective interdisciplinaire pour l’agroécologie. Rapport de synthèse," Post-Print hal-02154433, HAL.
    15. Galluzzo, Nicola, 2014. "Analysis of efficiency in organic wine and olive farms in the Italian FADN dataset," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182978, European Association of Agricultural Economists.
    16. Froehlich, Anderson G. & Melo, Andrea S.S.A. & Sampaio, Breno, 2018. "Comparing the Profitability of Organic and Conventional Production in Family Farming: Empirical Evidence From Brazil," Ecological Economics, Elsevier, vol. 150(C), pages 307-314.
    17. Spiegel, Alisa & Coletta, Attilio & Severini, Simone, 2022. "The distortive effect of organic payments: An example of policy failure in the case of hazelnut plantation," Land Use Policy, Elsevier, vol. 119(C).
    18. Bethan Thompson & Gaëlle Leduc & Gordana Manevska‐Tasevska & Luiza Toma & Helena Hansson, 2024. "Farmers' adoption of ecological practices: A systematic literature map," Journal of Agricultural Economics, Wiley Blackwell, vol. 75(1), pages 84-107, February.
    19. Galluzzo Nicola, 2020. "A Technical Efficiency Analysis of Financial Subsidies Allocated by the Cap in Romanian Farms Using Stochastic Frontier Analysis," European Countryside, Sciendo, vol. 12(4), pages 494-505, December.
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    More about this item

    Keywords

    organic farming; technical efficiency; subsidies; adverse selection; France;
    All these keywords.

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment

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