Estimating technical efficiency of Australian dairy farms using alternative frontier methodologies

Technical efficiency is estimated and examined for a cross-section of Australian dairy farms using various frontier methodologies; Bayesian and Classical stochastic frontiers, and Data Envelopment Analysis. The results indicate technical inefficiency is present in the sample data. Also identified are statistical differences between the point estimates of technical efficiency generated by the various methodologies. However, the rank of farm level technical efficiency is statistically invariant to the estimation technique employed. Finally, when confidence/credible intervals of technical efficiency are compared significant overlap is found for many of the farms' intervals for all frontier methods employed. The results indicate that the choice of estimation methodology may matter, but the explanatory power of all frontier methods is significantly weaker when interval estimate of technical efficiency is examined.

Examining the technical efficiency of rice producers in Bangladesh

Despite record national output in the early years of this decade there is widespread concern that rice yields in Bangladesh are below those attainable, and that given future population growth this may constrain achievement of food security and poverty reduction objectives. A frequent response to this problem is that farmers could close the gap between actual farm yields and potential yields identified in field trials if farmers who are technically inefficient could improve their current farming practices. This paper estimates and explains technical efficiency for a sample of rice farmers in Bangladesh employing Bayesian methods. The results provide insights into the distribution of technical efficiency and identify important influences on rice growing.

Profitability and technical efficiency of aquaculture systems in Pampanga, Philippines

We evaluate the profitability and technical efficiency of aquaculture in the Philippines. Farm-level data are used to compare two production systems corresponding to the intensive monoculture of tilapia in freshwater ponds and the extensive polyculture of shrimps and fish in brackish water ponds. Both activities are very lucrative, with brackish water aquaculture achieving the higher level of profit per farm. Stochastic frontier production functions reveal that technical efficiency is low in brackish water aquaculture, with a mean of 53%, explained primarily by the operator's experience and by the frequency of his visits to the farm. In freshwater aquaculture, the farms achieve a mean efficiency level of 83%. The results suggest that the provision of extension services to brackish water fish farms might be a cost-effective way of increasing production and productivity in that sector. By contrast, technological change will have to be the driving force of future productivity growth in freshwater aquaculture.

Application of a double bootstrap to investigation of determinants of technical efficiency of farms in Central Europe

The paper provides one of the first applications of the double bootstrap procedure (Simar and Wilson 2007) in a two-stage estimation of the effect of environmental variables on non-parametric estimates of technical efficiency. This procedure enables consistent inference within models explaining efficiency scores, while simultaneously producing standard errors and confidence intervals for these efficiency scores. The application is to 88 livestock and 256 crop farms in the Czech Republic, split into individual and corporate.

Application of a double bootstrap to investigation of determinants of technical efficiency of farms in Central Europe

The paper provides one of the first applications of the double bootstrap procedure (Simar and Wilson 2007) in a two-stage estimation of the effect of environmental variables on non-parametric estimates of technical efficiency. This procedure enables consistent inference within models explaining efficiency scores, while simultaneously producing standard errors and confidence intervals for these efficiency scores. The application is to 88 livestock and 256 crop farms in the Czech Republic, split into individual and corporate.

An application of the DEA double bootstrap to examine sources of efficiency in Bangladesh rice farming

In this article we examine sources of technical efficiency for rice farming in Bangladesh. The motivation for the analysis is the need to close the rice yield gap to enable food security. We employ the DEA double bootstrap of Simar and Wilson (2007) to estimate and explain technical efficiency. This technique overcomes severe limitations inherent in using the two-stage DEA approach commonly employed in the efficiency literature. From a policy perspective our results show that potential efficiency gains to reduce the yield gap are greater than previously found. Statistically positive influences on technical efficiency are education, extension and credit, with age being a negative influence.

Bayesian ranking and selection of fishing boat efficiencies

The steadily accumulating literature on technical efficiency in fisheries attests to the importance of efficiency as an indicator of fleet condition and as an object of management concern. In this paper, we extend previous work by presenting a Bayesian hierarchical approach that yields both efficiency estimates and, as a byproduct of the estimation algorithm, probabilistic rankings of the relative technical efficiencies of fishing boats. The estimation algorithm is based on recent advances in Markov Chain Monte Carlo (MCMC) methods—Gibbs sampling, in particular—which have not been widely used in fisheries economics. We apply the method to a sample of 10,865 boat trips in the US Pacific hake (or whiting) fishery during 1987–2003. We uncover systematic differences between efficiency rankings based on sample mean efficiency estimates and those that exploit the full posterior distributions of boat efficiencies to estimate the probability that a given boat has the highest true mean efficiency.

Dual technological development in Botswana agriculture: A Stochastic input distance function approach

To improve the welfare of the rural poor and keep them in the countryside, the government of Botswana has been spending 40% of the value of agricultural GDP on agricultural support services. But can investment make smallholder agriculture prosperous in such adverse conditions? This paper derives an answer by applying a two-output six-input stochastic translog distance function, with inefficiency effects and biased technical change to panel data for the 18 districts and the commercial agricultural sector, from 1979 to 1996 This model demonstrates that herds are the most important input, followed by draft power. land and seeds. Multilateral indices for technical change, technical efficiency and total factor productivity (TFP) show that the technology level of the commercial agricultural sector is more than six times that of traditional agriculture and that the gap has been increasing, due to technological regression in traditional agriculture and modest progress in commercial agriculture. Since the levels of efficiency are similar, the same patient is repeated by the TFP indices. This result highlights the policy dilemma of the trade-off between efficiency and equity objectives.