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

Abstract

This paper rede nes technical e ciency by incorporating provision of environmental goods as one of the outputs of the farm within a multi-outptut distance function framework.Permanent and rough grassland area are used as a proxy for the provision of environmental goods. The multi-output distance function approach is used to estimate technical e ciency.A Bayesian procedure involving the use of a Gibbs sampler is used to estimate the farm speci c e ciency as well as the coe cients of the distance function. In addition, a number of explanatory variables for the e ciency were introduced in the analysis and posterior distributions of those were obtained. The methodology is applied to panel data on 215 dairy farms in England and Wales from the Defra Farm Business Survey. Results show that both farm e ciency rankings and determinants of ine ciency change when provision of environmental outputs by farms is incorporated in the e ciency analysis, which may have important political implications.

The Impact of Climatic Change Adaptation on Agricultural Productivity in Central Chile: A Stochastic Production Frontier Approach

“…Areal et al [74] argue that if the information received by policy makers concerning farm efficiency levels is harmonized with policy aims, policy measures may be targeted to support the targeted farms. This deserves further consideration given that the literature that links efficiency and climate change adaptation is limited.…”

Efficiency Analysis of Electricity, Thermal Power Production and Supply Industries in China

“…Feng and Serletis [18] studied the total factor productivity of the large US Banks (assets at more than $one hundred million) from 2000 to 2005, and found that the average annual growth rate of these banks' total factor productivity during this period is 1.98%, but the total factor productivity growth rate showed a trend of decline, this is mainly due to a slowdown in the technical improvement. Areal et al [19] tor, and denied the "pollution haven hypothesis". Wang et al [28] analyzed the energy efficiency and productivity of 28 provinces in China (excluding Hainan and Tibet) in the "eleventh five-year plan" by using the directional distance function, and compared three situations: energy conservation; energy conservation and emission reduction; energy conservation, emissions reduction and economic growth.…”

Technical Efficiency in Dairy Farms: Research Synthesis and an Application in the South of Brazil

“…On the other hand, there are many studies that evaluate the effect of different methodologies and study-specific characteristics on TE Haghiri, et al, 2004;Areal, et al, 2012;Van Der Voort, et al, 2014). Some authors defend the two-stage procedure (Banker & Natarajan, 2008;McDonald, 2009) and other authors Battese & Coelli, 1995) criticise this approach by arguing that "the factors should be incorporated directly in the estimation of the production frontier because such factors may have a direct impact on efficiency" (Sharma, et al, 1999, p. 26).…”

“…Geographical location Álvarez & González, 1999) and farm size Areal, et al, 2012) are other factors that can affect the TE and despite the lack of general agreement, one might hypothesize that dairy farms with high levels of TE tend to be higher in a favourable context. Although the choice of the methodology to measure TE can have a direct impact on the results, there is no agreement as to the most appropriate methodology for a given situation (Olesen, et al, 1996), which remains a matter of ongoing debate .…”

“…Care with animal health (Hansson & Öhlmér, 2008;Gelan & Muriithi, 2010), feeding practices, such as fodder and feed (Chang & Mishra, 2011;Ma, et al, 2012), the use of automatic milking systems and frequency of milking (Hansson, 2007;Chang & Mishra, 2011;Chidmi, et al, 2010) were also discriminant. Dairy farms in better financial health (e.g., debt per cow, financial pressure) Barnes, 2008;Chidmi, et al, 2010;Areal, et al, 2012); with more investments per cow Chidmi, et al, 2010); and making larger use of agricultural services, such as extension, nutritionist and veterinary services (Chang & Mishra, 2011;Dong, et al, 2013) were also deemed to be better off in terms of TE. Generally, large size farms would more easily invest in human capital, animal health and agricultural services.…”