Modeling heterogeneous technologies in the presence of sample selection: The case of dairy farms and the adoption of agri‐environmental schemes in France

Modélisation de technologies hétérogènes en présence d'une sélection d'échantillon: le cas des exploitations laitières et de l'adoption des programmes agro-environnementaux en France

K Hervé Dakpo, Laure Latruffe, Yann Desjeux and Philippe Jeanneaux ()
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K Hervé Dakpo: ECO-PUB - Economie Publique - AgroParisTech - Université Paris-Saclay - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, ETH Zürich - Eidgenössische Technische Hochschule - Swiss Federal Institute of Technology [Zürich]
Philippe Jeanneaux: Territoires - Territoires - AgroParisTech - VAS - VetAgro Sup - Institut national d'enseignement supérieur et de recherche en alimentation, santé animale, sciences agronomiques et de l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UCA - Université Clermont Auvergne

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Abstract: In this article, we assess farms' technical efficiency accounting for their production heterogeneity and correcting for the potential endogeneity associated with the adoption of Common Agricultural Policy (CAP) agri-environmental schemes (AESs). We estimate a first-step selection probit model. In a second step we estimate the latent class stochastic frontier model (LCSFM) separately on each of the two sub-samples, the AESs adopters and the AESs non-adopters. We also account for heteroscedasticity in the estimation of inefficiency effects in the LCSFM within each sub-sample. The application is to Farm Accountancy Data Network (FADN) dairy farms in France during 2002–2016. We identify one class with intensive technology and one class with extensive technology for each of the two sub-samples. The investigation of inefficiency effects shows that modeling production heterogeneity could help better target the CAP, since the relationship between operational subsidies and farms' efficiency differs depending on whether or not production heterogeneity is accounted for.

Keywords: Agri-environmental schemes; Efficiency; France; Heterogeneous technologies; Latentclass; Sample selection (search for similar items in EconPapers)
Date: 2022
Note: View the original document on HAL open archive server: https://hal.inrae.fr/hal-03516608v1
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Citations: View citations in EconPapers (4)

Published in Agricultural Economics, 2022, 53 (3), pp.422-438. ⟨10.1111/agec.12683⟩

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Journal Article: Modeling heterogeneous technologies in the presence of sample selection: The case of dairy farms and the adoption of agri‐environmental schemes in France (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03516608

DOI: 10.1111/agec.12683

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