Patterns in Technical Efficiency and Technical Change at the Farm‐level in England and Wales, 1982–2002

Abstract

English and Welsh farm-level survey data are employed to estimate stochastic frontier production functions for eight different farm types (cereal, dairy, sheep, beef, poultry, pigs, general cropping and mixed) for the period 1982 to 2002. Differences in the relative efficiency of farms are explored by the simultaneous estimation of a model of technical inefficiency effects. The analysis shows that, generally, farms of all types are relatively efficient with a large proportion of farms operating close to the production frontier. However, whilst the frontier farms of all types are becoming more efficient through time because of technical change, it is also the case that the efficiency of the average farm for most farm types is increasing at a slower rate. In addition, annual mean levels of efficiency for most farm types have declined between 1982 and 2002. The factors that consistently appear to have a statistically significant effect on differences in efficiency between farms are: farm or herd size, farm debt ratios, farmer age, levels of specialisation and ownership status. Copyright 2006 Blackwell Publishing Ltd.

Provision of environmental output within a multi-output distance function approach

“…full e ciency) (van den Broeck et al 1994). In addition this value is in concordance with results of previous empirical work by Hadley (2006) on e ciency of dairy farms in England and Wales. In the empirical analysis for j > 1 e j = g j = 1 which implies relatively non-informative values which centre the prior for φ j over 1.…”

“…Farm size is considered a relevant determinant of e ciency in the literature (Hadley 2006;Iraizoz, Bardaji, and Rapun 2005). The number of cows was used to create a proxy dummy variable for farm size.…”

Input saving possibilities and practices contributing to more efficient beef production in Sweden

“…However, based on the existing literature, French beef farms have a TE of 65% (in 2000) (Latruffe et al 2009). The average estimated TE of beef farms in the UK is 82% for England (1992England ( -2002 (Hadley 2006) and 77% for Scotland (1989Scotland ( -2004 (Barnes 2008). The TE of beef farms in Kansas, USA, is similar to this (78%) (Featherstone et al 1997).…”

“…Regional differences in farm performance are a common finding (Barnes et al 2011, European Commission 2011, Galanopoulos et al 2006, Hadley 2006, Kumbhakar and Lien 2010, McCloud and Kumbhakar 2008, Sipiläinen et al 2008, Wang et al 2012. For Swedish farms specialising in beef production, differences in farm economic performance arising from differing regional and agro-environmental potential have been found to be relatively well compensated by the subsidy support provided for the period 1998).…”

“…Use of a single-output production frontier aggregating the agricultural output into one index (very often total value of farm output) has been a standard approach in farm-level efficiency analysis in numerous studies (e.g. Barnes 2008, Hadley 2006, Latruffe et al 2004). However, agricultural production is an example where multi-output multi-input technology is typical, even on farms specializing in a particular type of production.…”