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Evolving techniques in production function identification illustrated in the case of the US dairy

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  • Heesun Jang
  • Xiaodong Du

Abstract

We estimate production technologies of major dairy producing regions in the U.S. The simultaneity and sample selection biases are carefully corrected following the recent development in the literature. The commonly applied control function approaches are found to be misleading in correcting for biases of coefficient estimates on flexible and quasi-fixed input variables. We show that the emerging dairy regions have relatively higher aggregate productivity than traditional regions. Dynamic decomposition results indicate that surviving farms play a more important role in regional productivity growth than entering and exiting farms. Farm- and regional-level driving forces of farm productivity are also examined.

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  • Heesun Jang & Xiaodong Du, 2019. "Evolving techniques in production function identification illustrated in the case of the US dairy," Applied Economics, Taylor & Francis Journals, vol. 51(14), pages 1463-1477, March.
    • Handle: RePEc:taf:applec:v:51:y:2019:i:14:p:1463-1477
    DOI: 10.1080/00036846.2018.1527457
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    Cited by:

    1. Hutchins, Jared P. & Gong, Yating & Du, Xiaodong, 2021. "The Role of Animal Breeding in Productivity Growth: Evidence from Wisconsin Dairy Farms," 2021 Annual Meeting, August 1-3, Austin, Texas 313882, Agricultural and Applied Economics Association.
    2. Massimo Filippini & Suchita Srinivasan, 2022. "Investments in worker health and production: Evidence from Vietnam," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 30(2), pages 211-235, April.

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