Parametric Estimation Of Technical And Scale Efficiencies In Italian Citrus Farming

Fabio Madau ()

MPRA Paper from University Library of Munich, Germany

Abstract: Ray (1998) has proposed a model for estimating scale efficiency using a parametric approach. Following this methodology, a scale efficiency measure is obtained from the estimated parameters of the production frontier function and from the estimated scale elasticities. This study aims to estimate technical and scale efficiencies achieved by the Italian citrus fruit-growing farms. A stochastic frontier production model is considered in order to estimate technical and scale efficiencies. The analysis is expected to estimate the role of both technical and scale efficiencies in conditioning productivity. Particular attention is put on determining the (technical and scale) inefficiency effects associated with a set of structural and environmental variables that should affect efficiency and on the relationship between technical and scale efficiency scores. Empirical findings suggest that the greater portion of overall inefficiency in the sample might depend on producing below the production frontier than on operating under an inefficient scale. Indeed, room for improving technical efficiency is, on average, larger (29%) than the margin due to scale inefficiency (18.2%). Results also indicate a weak relationship between the two efficiency measures.

Keywords: Technical; efficiency; Scale; efficiency; Stochastic; Frontier; Analysis; Citrus; farming; Italy (search for similar items in EconPapers)
JEL-codes: C13 Q12 (search for similar items in EconPapers)
Date: 2010-11-18
New Economics Papers: this item is included in nep-agr and nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Parametric Estimation of Technical and Scale Efficiencies in Italian Citrus Farming (2011)
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