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Environmental Efficiency: Meaning and Measurement and Application to Australian Dairy Farms

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Abstract

Technical efficiency has been widely studied in the literature, but in its pursuit, many of the inputs used can impact on the environment. Environmental effects can be modelled as undesirable output or, as has been the case in more recent studies, as conventional inputs. This paper examines the concept of environmental efficiency and how it can be used to evaluate the performance of Australian dairy farming, using nitrogen surplus, arising from excessive applications of fertilizer, as a detrimental input. Farming promotes the image of clean and green production and if this image is to be maintained, there is a need to ensure activities are environmentally friendly

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File URL: http://www.deakin.edu.au/buslaw/aef/workingpapers/papers/swp2004_02.pdf
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Bibliographic Info

Paper provided by Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance in its series Economics Series with number 2004_02.

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Length: 17 pages
Date of creation: 26 Dec 2004
Date of revision:
Handle: RePEc:dkn:econwp:eco_2004_02

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Keywords: Efficiency; detrimental inputs; nitrogen surplus; DEA;

References

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  1. Alfons Weersink & Calum G. Turvey & Abdulahi Godah, 1990. "Decomposition Measures of Technical Efficiency for Ontario Dairy Farms," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 38(3), pages 439-456, November.
  2. Doucouliagos, Hristos & Hone, Phillip, 2000. "Deregulation and Subequilibrium in the Australian Dairy Processing Industry," The Economic Record, The Economic Society of Australia, vol. 76(233), pages 152-62, June.
  3. Stijn Reinhard & C.A. Knox Lovell & Geert Thijssen, 1999. "Econometric Estimation of Technical and Environmental Efficiency: An Application to Dutch Dairy Farms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(1), pages 44-60.
  4. Callens, Isabelle & Tyteca, Daniel, 1999. "Towards indicators of sustainable development for firms: A productive efficiency perspective," Ecological Economics, Elsevier, vol. 28(1), pages 41-53, January.
  5. Fare, Rolf, et al, 1989. "Multilateral Productivity Comparisons When Some Outputs Are Undesirable: A Nonparametric Approach," The Review of Economics and Statistics, MIT Press, vol. 71(1), pages 90-98, February.
  6. B. A. Larson & H. Vroomen, 1991. "Nitrogen, Phosphorus And Land Demands At The Us Regional Level: A Primal Approach," Journal of Agricultural Economics, Wiley Blackwell, vol. 42(3), pages 354-364.
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Cited by:
  1. Ana Rodríguez-Álvarez & Ignacio Rosal & José Baños-Pino, 2007. "The cost of strikes in the Spanish mining sector: modelling an undesirable input with a distance function," Journal of Productivity Analysis, Springer, vol. 27(1), pages 73-83, February.
  2. Watson, Alistair S., 2005. "Productivity and the Dairy Industry," Australasian Agribusiness Review, University of Melbourne, Melbourne School of Land and Environment, vol. 13.

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