Flexible panel data models for risky production technologies with an application to salmon aquaculture

Abstract

Primal panel data models of production risk are estimated, using more flexible specifications than has previously been the practice. Production risk has important implications for the analysis of technology adoption and technical efficiency, since risk averse producers will take into account both the mean and variance of output when ranking alternative technologies. Hence, one should estimate technical change separately for the deterministic part and the risk part of thetechnology.production risk, technical change, stochastic dominance, salmon aquaculture,

Production risk in multi-output industries: estimates from Norwegian dairy farms

“…Some studies have also investigated the effects of technological changes on 1 Econometric studies of production risk in agriculture using a primal model approach include Antle (1983), Antle andGoodger (1984), Di Falco et al (2007), Groom et al (2008), Griffiths and Anderson (1982), Kumbhakar (1993), Just and Pope (1979), Nelson and Preckel (1989), Regev et al (1997), Roberts et al (2004), Serra et al (2006), Traxler et al (1995) Wan and Anderson (1990), and Wan et al (1992), while aquaculture has been studied by Asche and Tveteras (1999) and Tveteras (1999Tveteras ( , 2000. 2 The state contingent approach (Chambers and Quiggin, 2001) has been introduced as an alternative to the traditional parametric stochastic production function approaches such as the Just-Pope specification belongs.…”

“…Full application of the state contingent approach is very data demanding (Just, 2003), and empirical work based on this approach has only recently appeared in the agricultural economics literature (O'Donnell and Griffiths, 2006;Chavas, 2008). th Congress of the European Association of Agricultural Economists -EAAE 2008 the structure of production risk (Traxler et al, 1995;Tveteras, 1999Tveteras, , 2000.…”

Buying Power in Uk Retail Chains: A Residual Supply Approach

“…The model specification for salmon differs from the others in that it includes both a time trend (t) and a squared time trend (t2). 7 These trends are not unreasonable since the salmon market has experienced a strong increase in supply during the last two decades due to strong productivity growth and technological change (Asche, 1997;Tveterås, 1999). Hall and Peixe's test for whether the instruments for oligopoly power are redundant cannot reject the null of redundancy for any of the instruments and provides a p-value of 0.125 for the joint test.…”

Currency Invoicing in Norwegian Salmon Export

“…3 Increased coordination in the supply chain has also led to more focus on different product attributes that also have value (Roheim, Gardiner, and Asche 2007;Roheim, Asche, and Insignaris 2011;Sogn-Grundvåg, Larsen, and Young 2013). 4 These tools are also used to address production risk (Asche and Tveterås, 1999;Tveterås 2000;Tveterås and Battese 2006) and price risk (Guttormsen 1999;Oglend and Sikveland 2008) is prevalent. Industry structure can also be used to address risks (Oglend and Tveterås 2009;Hermansen and Heen 2012).…”