Rural extension and technical efficiency in the Brazilian agricultural sector

Abstract

In this paper, we identify the effect of rural extension on the productive performance of Brazilian agricultural establishments, using technical efficiency as a measure of farm performance. The data used is drawn from the microdata of the 2006 Agricultural Census, accessed directly from the IBGE secrecy room. For this, we use an approach that combines the stochastic production frontier, considering selection bias in the adoption of rural extension (Heckman’s approach) and entropy balancing. We find that rural extension increases efficiency in the use of the productive inputs, with more technical efficiency found among adopting producers than non-adopters. When considering the differences according to farm size, an even greater effect is observed for larger producers. In addition, public rural extension generates higher technical efficiency scores than those obtained by privately-operated establishments.

Degraded pastures in Brazil: improving livestock production and forest restoration

“…Our simulations indicate that recovery of degraded pasture can increase the stocking rate, while forest restoration enhances conservation and supports FC compliance. However, several drivers act as We find that efficiency is positively related to RAS ( p < 0.01): the larger the area of livestock assisted by RAS, the greater the efficiency, in line with other recent studies [52][53][54][55]. Brazil once had one of the largest and most efficient public RAS programmes in the world, but they have been in decline since the fiscal crisis in the 1990s.…”

“…Although they still provide essential services, especially to the poorest producers, they have very limited budgets and human resources, and have even been discontinued in some regions. Private RAS have been consolidating in the country among farmers, usually services involving chemical input and machinery purchases, but they are still little noted among ranchers [ 54 ]. In fact, according to the latest Agricultural Census, only 1 out of 10 cattle ranchers declared to have been assisted or to have contracted RAS.…”

“…Embrapa recommendations, but it covered an average pasture area of 3.93 ± 1.88 Mha yr −1 , representing less than 3% of all pasturelands in the country. The low level of rural credit acquired by ranchers compared with farmers (agriculture occupies only 29% of total land use, but obtains 71% of all rural credit contracts) may be attributed to several well-documented barriers [20,[51][52][53][54][55]. The demand side accounts for several of these barriers: (i) less willingness to hold bank debt; (ii) ranching activity's higher liquidity, which allows anticipating revenues and avoiding loan interest rates; (iii) lower levels of technical and financial planning, and less adherence to RAS services, which both imply less ability to compete for loan resources; and (iv) a higher share of untitled lands.…”

“…Since 1970, the share of credit available from the National Rural Credit System-recently through the Safra Plan-for total livestock expenses has varied from 22 to 47% [68][69][70][71][72][73]. Based on the last Agriculture Census, we estimate that in 2017, around US$ 18 billion in both working capital and investments was expended on livestock in addition to rural credit, mostly included prepaid expenses, borrowing operations outside of rural credit, or private capital [54].…”

The Role of Cooperatives in Brazilian Agricultural Production

“…The provision of governmental rural extension mostly targets family-owned farms but also reaches non-family-owned farms. Freitas et al [48] found that extension was provided to all farm sizes in all regions of Brazil. Table 3 shows that MSCM is positively associated with governmental rural extension and access to credit.…”