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Productive efficiency of specialty and conventional coffee farmers in Costa Rica: Accounting for technological heterogeneity and self-selection

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  • Wollni, Meike
  • Brümmer, Bernhard

Abstract

A steep decline in coffee prices at the producer level led to considerable pressure for farmers in Costa Rica and producer countries all over the world. One possible reaction was moving to specialty markets, where price pressure was perceived to be lower. We use original survey data from 2002/2003 and 2003/2004 to analyze the factors influencing participation in specialty markets and to estimate separate production functions for specialty and conventional coffee farmers allowing for farm-specific inefficiencies. Applying a sample selection framework, we find significant selection bias in the sub-sample of specialty farmers and evidence for the overestimation of efficiency, if this bias is not adequately controlled for. Among the most important factors that influence farm-specific efficiency levels in the two sub-samples are the availability of additional income activities, experience in coffee cultivation, and membership in cooperatives. Based on the results, we derive policy recommendations to improve farmers’ production performance and ability to cope with the effects of the coffee crisis. These policy measures include the provision of extension services with respect to farm management skills, the creation of income opportunities in rural areas, and the support of farmer-owned cooperatives.

Suggested Citation

  • Wollni, Meike & Brümmer, Bernhard, 2012. "Productive efficiency of specialty and conventional coffee farmers in Costa Rica: Accounting for technological heterogeneity and self-selection," Food Policy, Elsevier, vol. 37(1), pages 67-76.
  • Handle: RePEc:eee:jfpoli:v:37:y:2012:i:1:p:67-76
    DOI: 10.1016/j.foodpol.2011.11.004
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    1. Hernandez-Aguilera, Juan N. & Gómez, Miguel I. & Rodewald, Amanda D. & Rueda, Ximena & Anunu, Colleen & Bennett, Ruth & Schindelbeck, Robert R. & van Es, Harold M., 2015. "Impacts of smallholder participation in high-quality coffee markets: The Relationship Coffee Model," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205650, Agricultural and Applied Economics Association.
    2. Noltze, Martin & Schwarze, Stefan & Qaim, Matin, 2013. "Impacts of natural resource management technologies on agricultural yield and household income: The system of rice intensification in Timor Leste," Ecological Economics, Elsevier, vol. 85(C), pages 59-68.
    3. Herbert, Ainembabazi & Asten, Piet & Vanlauwe, Bernard & Ouma, Emily & Blomme, Guy & Birachi, Eliud & Manyong, Victor M. & Macharia, Ibrahim, 2015. "Improving the adoption of agricultural technologies and farm performance through farmer groups: Evidence from the Great Lakes Region of Africa," 2015 Conference, August 9-14, 2015, Milan, Italy 210939, International Association of Agricultural Economists.
    4. Mette Asmild & Tomas Baležentis & Jens Hougaard, 2016. "Multi-directional program efficiency: the case of Lithuanian family farms," Journal of Productivity Analysis, Springer, vol. 45(1), pages 23-33, February.
    5. Christophe Nordman & Julia Vaillant, 2013. "Inputs, Gender Roles or Sharing Norms? Assessing the Gender Performance Gap Among Informal Entrepreneurs in Madagascar," Working Papers DT/2013/15, DIAL (Développement, Institutions et Mondialisation).
    6. Bravo-Monroy, L. & Potts, S.G. & Tzanopoulos, J., 2016. "Drivers influencing farmer decisions for adopting organic or conventional coffee management practices," Food Policy, Elsevier, vol. 58(C), pages 49-61.
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