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The role of public subsidies on farms’ managerial efficiency: An application of a five-stage approach to France

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Author Info

  • Laure Latruffe
  • Hervé Guyomard
  • Chantal Le Mouël

Abstract

This paper applies a five-step approach to the investigation of the relationship between public subsidies, namely CAP direct payments, and managerial efficiency for French COP and beef farms in 2000. Managerial efficiency scores are calculated using a four-step approach that allows disentangling managerial inefficiency from unfavourable external conditions. Then, in a fifth stage, managerial efficiency scores are regressed over a set of explanatory variables, including CAP direct payments. Using individual farm data and meteorological data at the municipality level, we show that there is a non negligible component of inefficiency that is due to unfavourable conditions, and there is a strong significant negative relationship between managerial efficiency and CAP direct payments.

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Bibliographic Info

Paper provided by INRA UMR SMART in its series Working Papers SMART - LERECO with number 09-05.

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Date of creation: 2009
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Handle: RePEc:rae:wpaper:200905

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Keywords: technical efficiency; managerial efficiency; direct payments; farms; France;

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References

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Citations

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Cited by:
  1. Latruffe, Laure & Bravo-Ureta, Boris E. & Moreira, Victor H. & Desjeux, Yann & Dupraz, Pierre, 2012. "Productivity and Subsidies in the European Union: An Analysis for Dairy Farms Using Input Distance Frontiers," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126846, International Association of Agricultural Economists.
  2. Bakucs, Lajos Zoltan & Ferto, Imre & Fogarasi, Jozsef & Latruffe, Laure & Desjeux, Yann & Matveev, Eduard & Marongiu, Sonia & Dolman, Mark & Soboh, Rafat, 2011. "EU farms’ technical efficiency and productivity change in 1990 – 2006," 85th Annual Conference, April 18-20, 2011, Warwick University, Coventry, UK 108773, Agricultural Economics Society.
  3. Douarin, Elodie & Latruffe, Laure, 2009. "Will the EU Single Area Payment decrease farm efficiency in the New Member States?," 2009 Conference, August 16-22, 2009, Beijing, China 51625, International Association of Agricultural Economists.
  4. Rizov, Marian & Pokrivcak, Jan & Ciaian, Pavel, 2012. "CAP subsidies and productivity of the EU farms," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 124970, International Association of Agricultural Economists.
  5. Latruffe, Laure & Bravo-Ureta, Boris E. & Moreira, Victor H. & Desjeux, Yann & Dupraz, Pierre, 2011. "Productivity and Subsidies in European Union Countries: An Analysis for Dairy Farms Using Input Distance Frontiers," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114396, European Association of Agricultural Economists.
  6. Rizov, Marian & Pokrivcak, Jan & Ciaian, Pavel, 2013. "CAP Subsidies and the Productivity of EU Farms," Factor Markets Working Papers 148, Centre for European Policy Studies.
  7. Bakucs, Lajos Zoltan & Ferto, Imre & Latruffe, Laure & Desjeux, Yann & Soboh, Rafat & Dolman, Mark, 2011. "Comparative Analysis of Technical Efficiency in European Agriculture," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114235, European Association of Agricultural Economists.

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