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Agglomeration externalities and technical efficiency in French pig production

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  • Solène Larue
  • Laure Latruffe

Abstract

The objective of the paper is to assess the effects of spatial agglomeration on the technical efficiency of French pig farms. We use a two-stage method with the first stage consisting of calculating the efficiency scores of pig activity with the non-parametric Data Envelopment Analysis (DEA) method, and the second stage being a regression of these scores on agglomeration variables. Data consist of 936 French pig producers in 2004. Results suggest that these farms were as much affected by positive agglomeration externalities (in the form of knowledge spillovers due to the density of farms, and arising from their closeness to downstream markets) as any other businesses. Our analysis also sheds light on the specificity of the sector, namely that environment pressures can force pig farmers to be more efficient, an effect that may be counteracted when legal dispositions relating to manure spreading are too stringent.

Suggested Citation

  • Solène Larue & Laure Latruffe, 2009. "Agglomeration externalities and technical efficiency in French pig production," Working Papers SMART 09-10, INRAE UMR SMART.
    • Handle: RePEc:rae:wpaper:200910
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    File URL: http://www6.rennes.inra.fr/smart/Media/Working-papers/WP09-10
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    2. Juan Cabas Monje & Bouali Guesmi & Amer Ait Sidhoum & José María Gil, 2023. "Measuring technical efficiency of Spanish pig farming: Quantile stochastic frontier approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 67(4), pages 688-703, October.
    3. Hunecke, C. & Meyer, S. & Brummer, B., 2018. "Technology Diffusion through Networks - Adoption of automatic milking systems in Germany," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277543, International Association of Agricultural Economists.
    4. Roguet, Christine & Duflot, Boris & Rieu, Michel, 2017. "Évolution des modèles d’élevage de porcs en Europe et impacts sur les performances technico-économiques‪," Économie rurale, French Society of Rural Economics (SFER Société Française d'Economie Rurale), vol. 357(January-M).
    5. Diejun Huang & Qiuzhuo Ma & Liangyu Feng & Xiaowei Wen & Hua Li, 2018. "Applying Data Mining to China’s Swine Farming Industry: A Compromise Perspective of Economic, Environmental and Overall Performances," Sustainability, MDPI, vol. 10(7), pages 1-26, July.

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    More about this item

    Keywords

    technical efficiency; Data Envelopment Analysis; agglomeration; environmental regulation; hog production; France;
    All these keywords.

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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