A metafrontier directional distance function approach to assessing eco-efficiency

This paper uses directional distance functions to extend the non-parametric metafrontier approach to efficiency measurement proposed by OÕDonnell et al. (2008) to the assessment of technological differences in eco-efficiency between groups of producers. Furthermore, eco-efficiency is assessed at the level of specific environmental pressures management. This methodology is applied to a sample of Spanish olive producers that belong to both traditional mountain and traditional plain growing systems. We find great potential for both olive growing systems to reduce environmental pressures. In terms of pressures on natural resources, the most eco-efficient technology corresponds to the traditional plain system, while the traditional mountain system is the most eco-efficient when considering pressures on biodiversity. These results might help policymakers design strategies aimed at improving the performance of olive growing and meeting the demands of society regarding the economic and ecological functions of this farming activity.