EconPapers    
Economics at your fingertips  
 

Using Non-parametric Methods in Econometric Production Analysis: An Application to Polish Family Farms

Tomasz Czekaj and Arne Henningsen

No 114280, 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland from European Association of Agricultural Economists

Abstract: Econometric estimation of production functions is one of the most common methods in applied economic production analysis. These studies usually apply parametric estimation techniques, which obligate the researcher to specify the functional form of the production function. Most often, the Cobb-Douglas or the Translog production function is used. However, the specification of a functional form for the production function involves the risk of specifying a functional form that is not similar to the “true” relationship between the inputs and the output. This misspecification might result in biased estimation results—including measures that are of interest of applied economists, such as elasticities. Therefore, we propose to use nonparametric econometric methods. First, they can be applied to verify the functional form used in parametric estimations of production functions. Second, they can be directly used for estimating production functions without specifying a functional form and thus, avoiding possible misspecification errors. We use a balanced panel data set of farms specialized in crop production that is constructed from Polish FADN data for the years 2004-2007. Our analysis shows that neither the Cobb-Douglas function nor the Translog function are consistent with the “true” relationship between the inputs and the output in our data set. We solve this problem by using non-parametric regression. This approach delivers reasonable results, which are on average not too different from the results of the parametric estimations but many individual results are rather different.

Keywords: Farm; Management (search for similar items in EconPapers)
Pages: 12
Date: 2011
New Economics Papers: this item is included in nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://ageconsearch.umn.edu/record/114280/files/Czekaj_Tomasz_232.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:eaae11:114280

DOI: 10.22004/ag.econ.114280

Access Statistics for this paper

More papers in 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland from European Association of Agricultural Economists Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().

 
Page updated 2020-09-12
Handle: RePEc:ags:eaae11:114280