Are Efficient Farms and Inefficient Farms Heterogeneous?

Youngjune Kim, Bowen Chen, Allen Featherstone and Dustin Pendell

No 252830, 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama from Southern Agricultural Economics Association

Abstract: Data Envelopment Analysis (DEA) is one technique that is commonly used for measuring efficiency. Previous studies focus on identifying the sources of inefficiency with implicit assumption of homogeneity between efficient and inefficient farms. Since technical efficiency cannot be greater than one in the standard DEA, those studies are not capturing the marginal effects of input variables on the efficiency improvement for efficient farms, which leaves the heterogeneity in the marginal effects hard to be examined. We exploit a methodology called super DEA, which facilitates the study on the heterogeneity by producing the ranking information in the efficient Decision Making Units(DMUs). A quantile regression is employed to identify the sources of efficiency for efficient farms and inefficient farms, respectively. Using the Kansas Farm Management Association (KFMA), we find that an increase in feed affects efficiency in opposite ways for efficient farms and inefficient farms. This result suggests that efficient and inefficient farms are heterogeneous.

Keywords: Farm Management; Production Economics; Productivity Analysis (search for similar items in EconPapers)
Pages: 14
Date: 2017
New Economics Papers: this item is included in nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/252830/files/A ... %20Heterogeneous.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:saea17:252830

DOI: 10.22004/ag.econ.252830

Access Statistics for this paper

More papers in 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama from Southern Agricultural Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().