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Scale Efficiency in Organic and Conventional Dairy Farming

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  • Salhofer, Klaus
  • Kargiannis, Giannis
  • Sinabell, Franz

Abstract

Recently, several studies compared the performance of conventional and organic farms. Most studies concentrated on technical efficiency. In this paper we add to this literature by also comparing the scale efficiency of conventional and organic milk farms in Austria during the period 1997-2002. To do so we utilize a bilateral production frontier that includes both production technologies and Green’s (1995a,b) true fixed effects model to account for firm specific time-invariant heterogeneity and technical inefficiency. We find both groups of farms to be on average equally technical efficient (when compared to their production frontier), but conventional farms being on average considerably more scale efficient. However, while scale efficiency remained constant over time for conventional farms it increased for organic farms which seem to catch up.

Suggested Citation

  • Salhofer, Klaus & Kargiannis, Giannis & Sinabell, Franz, 2012. "Scale Efficiency in Organic and Conventional Dairy Farming," 2012 First Congress, June 4-5, 2012, Trento, Italy 124119, Italian Association of Agricultural and Applied Economics (AIEAA).
    • Handle: RePEc:ags:aieacp:124119
    DOI: 10.22004/ag.econ.124119
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    References listed on IDEAS

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    Cited by:

    1. Djokoto, Justice G., 2015. "Technical efficiency of organic agriculture: a quantitative review," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 117(2), pages 1-11, August.
    2. Singh, S.P. & Sajwan, Priya & Sajwan, Komal, 2023. "Technical Efficiency in Organic and Conventional Wheat Farms: Evidence from a Primary Survey from Two Districts of Ganga River Basin, India," 97th Annual Conference, March 27-29, 2023, Warwick University, Coventry, UK 334558, Agricultural Economics Society - AES.
    3. Lakner, Sebastian & Breustedt, Gunnar, 2015. "Efficiency analysis of organic farming systems- a review of methods, topics, results, and conclusions," 2015 Conference, August 9-14, 2015, Milan, Italy 212025, International Association of Agricultural Economists.
    4. DJOKOTO, Justice Gameli & OWUSU, Victor & AWUNYO-VITOR, Dadson, 2020. "Is Organic Agriculture More Scale Efficient Than Conventional Agriculture? The Case Of Cocoa Cultivation In Ghana," Review of Agricultural and Applied Economics (RAAE), Faculty of Economics and Management, Slovak Agricultural University in Nitra, vol. 23(2), October.
    5. Stefano Orsini & Susanne Padel & Nic Lampkin, 2018. "Labour Use on Organic Farms: A Review of Research since 2000," Organic Farming, Librello publishing house, vol. 4(1), pages 7-15.

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