ADJUSTMENT COSTS AND EFFICIENCY IN POLISH AGRICULTURE: A DYNAMIC EFFICIENCY APPROACH

Supawat Rungsuriyawiboon and Heinrich Hockmann ()

No 126737, 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil from International Association of Agricultural Economists

Abstract: This paper aims to understand the state of adjustment process and dynamic structure in Polish agriculture. A dynamic cost frontier model using the shadow cost approach is formulated to decompose cost efficiency into allocative and technical efficiencies. The dynamic cost efficiency model is developed into a more general context with a multiple quasi-fixed factor case. The model is implemented empirically using a panel data set of 1,143 Polish farms over the period 2004 to 2007. Due to the regional disparities and a wide variety of farm specialization, farms are categorized into two regions and five types of farm production specialization. The estimation results confirm our observation that adjustment is rather sluggish implying that adjustment cost are considerably high. It takes up to 30 years until Polish farmers reach their optimal level of capital and land input. Allocative and technical efficiency differ widely across regions. Moreover, efficiency is rather stable over time and among farm specialisations. However, their results indicate that the regions characterized by the larger farms perform slightly better.

Keywords: Agribusiness; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 23
Date: 2012
New Economics Papers: this item is included in nep-agr and nep-eff
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Journal Article: Adjustment costs and efficiency in Polish agriculture: a dynamic efficiency approach (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iaae12:126737

DOI: 10.22004/ag.econ.126737

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