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Technical Efficiency of Australian Wool Production: Point and Confidence Interval Estimates

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Author Info

  • Iain Fraser

    (LaTrobe University)

  • William C. Horrace

    (Syracuse University)

Abstract

A balanced panel of data is used to estimate technical efficiency, employing a fixed-effects stochastic frontier specification for wool producers in Australia. Both point estimates and confidence intervals for technical efficiency are reported. The confidence intervals are constructed using the Multiple Comparisons with the Best (MCB) procedure of Horrace and Schmidt (2000). The confidence intervals make explicit the precision of the technical efficiency estimates and underscore the dangers of drawing inferences based solely on point estimates. Additionally, they allow identification of wool producers that are statistically efficient and those that are statistically inefficient. The data reveal at the 95% confidence level that twenty-one of the twenty-six wool farms analyzed may be efficient.

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File URL: http://128.118.178.162/eps/pe/papers/0206/0206001.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Public Economics with number 0206001.

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Length: 34 pages
Date of creation: 19 Jun 2002
Date of revision: 11 May 2003
Handle: RePEc:wpa:wuwppe:0206001

Note: Type of Document - Acrobat PDF; prepared on IBM PC; to print on HP; pages: 34; figures: included/request from author/draw your own. Multiple comparison procedures applied to wool production
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Web page: http://128.118.178.162

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Keywords: Wool; Technical Efficiency; MCB; MCC;

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References

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Cited by:
  1. Lohr, Luanne & Park, Timothy A., 2006. "Technical Efficiency of U.S. Organic Farmers: The Complementary Roles of Soil Management Techniques and Farm Experience," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 35(2), October.
  2. Tai-Hsin Huang & Tong-Liang Kao, 2006. "Joint estimation of technical efficiency and production risk for multi-output banks under a panel data cost frontier model," Journal of Productivity Analysis, Springer, vol. 26(1), pages 87-102, August.
  3. Lohr, Luanne & Park, Timothy A., 2009. "Labor Pains: Valuing Seasonal versus Year-Round Labor on Organic Farms," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 34(2), August.

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