Lameness, metabolic and digestive disorders, and technical efficiency in Danish dairy herds: a stochastic frontier production function approach

The relationship between reported treatments of lameness, metabolic disorders (milk fever, ketosis), digestive disorders, and technical efficiency (TE) was investigated using neutral and non-neutral stochastic frontier analysis (SFA). TE is estimated relative to the stochastic frontier production function for a sample of 574 Danish dairy herds collected in 1997. Contrary to most published results, but in line with the expected negative impact of disorders on the average cow milk production, herds reporting higher frequencies of milk fever are less technically efficient. Unexpectedly, however, the opposite results were observed for lameness, ketosis, and digestive disorders. The non-neutral stochastic frontier indicated that the opposite results are due to the relative. high productivities of inputs. The productivity of the cows is also reflected by the direction of impact of herd management variables. Whereas efficient farms replace cows more frequently, enroll heifers in production at an earlier age, and have shorter calving intervals, they also report higher frequency of disorder treatments. The average estimated energy corrected milk loss per cow is 1036, 451 and 242 kg for low, medium and high efficient farms. The study demonstrates the benefit of the stochastic frontier production function involving the estimation of individual technical efficiencies to evaluate farm performance and investigate the source of inefficiency. (C) 2004 Elsevier B.V. All rights reserved.

A stochastic frontier production function with flexible risk properties

This paper considers a stochastic frontier production function which has additive, heteroscedastic error structure. The model allows for negative or positive marginal production risks of inputs, as originally proposed by Just and Pope (1978). The technical efficiencies of individual firms in the sample are a function of the levels of the input variables in the stochastic frontier, in addition to the technical inefficiency effects. These are two features of the model which are not exhibited by the commonly used stochastic frontiers with multiplicative error structures, An empirical application is presented using cross-sectional data on Ethiopian peasant farmers. The null hypothesis of no technical inefficiencies of production among these farmers is accepted. Further, the flexible risk models do not fit the data on peasant farmers as well as the traditional stochastic frontier model with multiplicative error structure.

Assessing the performance of a nucleus estate and smallholder scheme for oil palm production in West Sumatra: a stochastic frontier analysis

In this paper, we study the performance of smallholders in a nucleus estate and smallholder (NES) scheme in oil palm production schemein West Sumatra by measuring their technical efficiency using a stochastic frontier production function. Our results indicate a mean technical efficiency of 66%, which is below what we would have expected given the uniformity of the climate, soils and plantation construction among the sample farmers. The use of progressive farmers as a means of disseminating extension advice does not appear to have been successful, and more rigorous farmer selection procedures need to be put in place for similar schemes and for general agricultural extension in future. No clear relationship was established between technical efficiency and the use of female labour, suggesting there is no need to target extension services specifically at female labourers in the household. Finally, education was found to have an unexpectedly negative impact on technical efficiency, indicating that farmers with primary education may be more important than those with secondary and tertiary education as targets of development schemes and extension programs entailing non-formal education. (C) 2003 Elsevier Ltd. All rights reserved.

Relationships of Efficiency to Reproductive Disorders in Danish Milk Production: A Stochastic Frontier Analysis

Relationships of various reproductive disorders and milk production performance of Danish dairy farms were investigated. A stochastic frontier production function was estimated using data collected in 1998 from 514 Danish dairy farms. Measures of farm-level milk production efficiency relative to this production frontier were obtained, and relationships between milk production efficiency and the incidence risk of reproductive disorders were examined. There were moderate positive relationships between milk production efficiency and retained placenta, induction of estrus, uterine infections, ovarian cysts, and induction of birth. Inclusion of reproductive management variables showed that these moderate relationships disappeared, but directions of coefficients for almost all those variables remained the same. Dystocia showed a weak negative correlation with milk production efficiency. Farms that were mainly managed by young farmers had the highest average efficiency scores. The estimated milk losses due to inefficiency averaged 1142, 488, and 256 kg of energy-corrected milk per cow, respectively, for low-, medium-, and high-efficiency herds. It is concluded that the availability of younger cows, which enabled farmers to replace cows with reproductive disorders, contributed to high cow productivity in efficient farms. Thus, a high replacement rate more than compensates for the possible negative effect of reproductive disorders. The use of frontier production and efficiency/ inefficiency functions to analyze herd data may enable dairy advisors to identify inefficient herds and to simulate the effect of alternative management procedures on the individual herd's efficiency.

A metafrontier production function for estimation of technical efficiencies and technology gaps for firms operating under different technologies

This paper presents a metafrontier production function model for firms in different groups having different technologies. The metafrontier model enables the calculation of comparable technical efficiencies for firms operating under different technologies. The model also enables the technology gaps to be estimated for firms under different technologies relative to the potential technology available to the industry as a whole. The metafrontier model is applied in the analysis of panel data on garment firms in five different regions of Indonesia, assuming that the regional stochastic frontier production function models have technical inefficiency effects with the time-varying structure proposed by Battese and Coelli ( 1992).

Addressing shortcomings in the Household Responsibility System - Empirical analysis of the Two-Farmland System in Shandong Province

Despite apparent overwhelming benefits, implementation of the Household Responsibility System (HRS) in China contained a number of flaws. The Two-Farmland System (TFS), which originated in Pingdu City in Shandong Province, sought to address the twin problems of land fragmentation and economies of size. A stochastic frontier production function analysis that isolates the impacts of land allocation reforms suggests that the TFS increased efficiency by around 7%. This article highlights the need for empirical analysis to assess objectively the merits or otherwise of particular reforms. (C) 2002 Elsevier Science Inc. All rights reserved.

SCORPION2: A database for structure-function analysis of scorpion toxins

Scorpion toxins are important experimental tools for characterization of vast array of ion channels and serve as scaffolds for drug design. General public database entries contain limited annotation whereby rich structure-function information from mutation studies is typically not available. SCORPION2 contains more than 800 records of native and mutant toxin sequences enriched with binding affinity and toxicity information, 624 three-dimensional structures and some 500 references. SCORPION2 has a set of search and prediction tools that allow users to extract and perform specific queries: text searches of scorpion toxin records, sequence similarity search, extraction of sequences, visualization of scorpion toxin structures, analysis of toxic activity, and functional annotation of previously uncharacterized scorpion toxins. The SCORPION2 database is available at http://sdmc.i2r.a-star.edu.sg/scorpion/. (c) 2006 Elsevier Ltd. All rights reserved.

Estimating variable returns to scale production frontiers with alternative stochastic assumptions

Two stochastic production frontier models are formulated within the generalized production function framework popularized by Zellner and Revankar (Rev. Econ. Stud. 36 (1969) 241) and Zellner and Ryu (J. Appl. Econometrics 13 (1998) 101). This framework is convenient for parsimonious modeling of a production function with returns to scale specified as a function of output. Two alternatives for introducing the stochastic inefficiency term and the stochastic error are considered. In the first the errors are added to an equation of the form h(log y, theta) = log f (x, beta) where y denotes output, x is a vector of inputs and (theta, beta) are parameters. In the second the equation h(log y,theta) = log f(x, beta) is solved for log y to yield a solution of the form log y = g[theta, log f(x, beta)] and the errors are added to this equation. The latter alternative is novel, but it is needed to preserve the usual definition of firm efficiency. The two alternative stochastic assumptions are considered in conjunction with two returns to scale functions, making a total of four models that are considered. A Bayesian framework for estimating all four models is described. The techniques are applied to USDA state-level data on agricultural output and four inputs. Posterior distributions for all parameters, for firm efficiencies and for the efficiency rankings of firms are obtained. The sensitivity of the results to the returns to scale specification and to the stochastic specification is examined. (c) 2004 Elsevier B.V. All rights reserved.

Drought policy: a graphical analysis

The standard approach to modelling production under uncertainty has relied on the concept of the stochastic production function. In the present paper, it is argued that a state-contingent production model is more flexible and realistic. The model is applied to the problem of drought policy.

An introduction to efficiency and productivity analysis

The second edition of An Introduction to Efficiency and Productivity Analysis is designed to be a general introduction for those who wish to study efficiency and productivity analysis. The book provides an accessible, well-written introduction to the four principal methods involved: econometric estimation of average response models; index numbers, data envelopment analysis (DEA); and stochastic frontier analysis (SFA). For each method, a detailed introduction to the basic concepts is presented, numerical examples are provided, and some of the more important extensions to the basic methods are discussed. Of special interest is the systematic use of detailed empirical applications using real-world data throughout the book. In recent years, there have been a number of excellent advance-level books published on performance measurement. This book, however, is the first systematic survey of performance measurement with the express purpose of introducing the field to a wide audience of students, researchers, and practitioners. Indeed, the 2nd Edition maintains its uniqueness: (1) It is a well-written introduction to the field. (2) It outlines, discusses and compares the four principal methods for efficiency and productivity analysis in a well-motivated presentation. (3) It provides detailed advice on computer programs that can be used to implement these performance measurement methods. The book contains computer instructions and output listings for the SHAZAM, LIMDEP, TFPIP, DEAP and FRONTIER computer programs. More extensive listings of data and computer instruction files are available on the book's website: (www.uq.edu.au/economics/cepa/crob2005).

Diversification economies and specialisation efficiencies in a mixed food and coffee smallholder farming system in Papua New Guinea

Smallholder farming systems in Papua New Guinea are characterised by an integrated set of cash cropping and subsistence food cropping activities. In the Highlands provinces, the subsistence food crop sub-system is dominated by sweet potato production. Coffee dominates the cash cropping sub-system, but a limited number of food crops are also grown for cash sale. The dynamics between sub-systems can influence the scope for complementarity between, and technical efficiency of, their operations, especially in light of the seasonality of demand for household labour and management inputs within the farming system. A crucial element of these dynamic processes is diversification into commercial agricultural production, which can influence factor productivity and the efficiency of crop production where smallholders maintain a strong production base in subsistence foods. In this study we use survey data from households engaged in coffee and food crop production in the Benabena district of Eastern Highlands Province to derive technical efficiency indices for each household over two years. A stochastic input distance function approach is used to establish whether diversification economies exist and whether specialisation in coffee, subsistence food or cash food production significantly influences technical efficiency on the sampled smallholdings. Diversification economics are weakly evident between subsistence food production and both coffee and cash food production, but diseconomies of diversification are discerned between coffee and cash food production. A number of factors are tested for their effects on technical efficiency. Significant technical efficiency gains are made from diversification among broad cropping enterprises.

Capital market equilibrium with moral hazard and flexible technology

(Magill, M., Quinzii, M., 2002. Capital market equilibrium with moral hazard. Journal of Mathematical Economics 38, 149-190) showed that, in a stockmarket economy with private information, the moral hazard problem may be resolved provided that a spanning overlap condition is satisfed. This result depends on the assumption that the technology is given by a stochastic production function with a single scalar input. The object of the present paper is to extend the analysis of Magill and Quinzii to the case of multiple inputs. We show that their main result extends to this general case if and only if, for each firm, the number of linearly independent combinations of securities having payoffs correlated with, but not dependent on, the firms output is equal to the number of degrees of freedom in the firm's production technology.