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Decomposition of Total Factor Productivity Change in the U.S. Hog Industry, 1992-2004

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Author Info

  • Key, Nigel D.
  • McBride, William D.
  • Mosheim, Roberto

Abstract

There have been dramatic structural changes in the U.S. hog industry in the last two decades that have coincided with substantial increases in farm productivity. This study used a stochastic frontier analysis to measure TFP growth between 1992 and 2004 and to decompose the TFP growth into four components: technical change and changes in technical efficiency, scale efficiency, and allocative efficiency. The study finds that productivity gains in the twelve year study period are explained almost entirely by technical progress and by improvements in scale efficiency. The study also disaggregates TFP growth in the Southeast and Heartland to better understand the implications of large spatial shifts in production. Results indicate that regional differences in TFP growth in the 1992-1998 and 1998-2004 periods can be explained primarily by changes in scale of production. Results indicate that despite large increases in the scale of production, there remains substantial scope for further scale efficiency gains, particularly in the Heartland where farms operate at a smaller average scale compared to in the Southeast.

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File URL: http://purl.umn.edu/21323
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Bibliographic Info

Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2006 Annual meeting, July 23-26, Long Beach, CA with number 21323.

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Date of creation: 2006
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Handle: RePEc:ags:aaea06:21323

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Keywords: Livestock Production/Industries;

References

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  1. Bernhard Br�mmer & Thomas Glauben & Geert Thijssen, 2002. "Decomposition of Productivity Growth Using Distance Functions: The Case of Dairy Farms in Three European Countries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(3), pages 628-644.
  2. Hayri �nal & Laurian Unnevehr & Aleksandar Bekric, 2000. "Regional Shifts in Pork Production: Implications for Competition and Food Safety," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(4), pages 968-978.
  3. Tim Coelli & Antonio Estache & Sergio Perelman & Lourdes Trujillo, 2003. "A Primer on Efficiency Measurement for Utilities and Transport Regulators," World Bank Publications, The World Bank, number 15149, October.
  4. McBride, William D. & Key, Nigel D., 2003. "Economic And Structural Relationships In U.S. Hog Production," Agricultural Economics Reports 33971, United States Department of Agriculture, Economic Research Service.
  5. Tonsor, Glynn T. & Featherstone, Allen M., 2006. "Heterogeneous Production Efficiency of Specialized Swine Producers," 2006 Annual Meeting, February 5-8, 2006, Orlando, Florida 35379, Southern Agricultural Economics Association.
  6. Brian Roe & Elena G. Irwin & Jeff S. Sharp, 2002. "Pigs in Space: Modeling the Spatial Structure of Hog Production in Traditional and Nontraditional Production Regions," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(2), pages 259-278.
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Cited by:
  1. Key, Nigel D. & McBride, William D., 2012. "Sub-therapeutic Antibiotics and the Efficiency of U.S. Hog Farms," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124725, Agricultural and Applied Economics Association.

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