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Technical Efficiency of Cooperative and Non-Cooperative Dairies in Poland: Toward the First Link of the Supply Chain

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  • Katarzyna Ziętek-Kwaśniewska

    (The Institute of Economics and Finance, Faculty of Social Sciences, The John Paul II Catholic University of Lublin, Al. Racławickie 14, 20-950 Lublin, Poland)

  • Maria Zuba-Ciszewska

    (The Institute of Economics and Finance, Faculty of Social Sciences, The John Paul II Catholic University of Lublin, Al. Racławickie 14, 20-950 Lublin, Poland)

  • Joanna Nucińska

    (The Institute of Economics and Finance, Faculty of Social Sciences, The John Paul II Catholic University of Lublin, Al. Racławickie 14, 20-950 Lublin, Poland)

Abstract

Several studies conducted in various countries have addressed the technical efficiency of dairies. However, there is a paucity of research on the technical efficiency of dairies in Poland, particularly in relation to their legal form (i.e., cooperatives vs. non-cooperatives). The existing literature also does not provide insights into the technical efficiency of these entities with respect to different regions’ milk production capacity. Therefore, this paper aims to: (1) evaluate and compare the technical efficiency of cooperative and non-cooperative dairies in Poland, and (2) examine dairies’ technical efficiency due to spatial disparities in milk production potential. We use data envelopment analysis (DEA) to investigate the technical efficiency of 108 dairies in Poland for the year 2019. The milk production capacity of provinces is examined by applying the zero unitarization method. The results show that when assuming constant returns to scale (CRS), dairy cooperatives are less technically efficient than non-cooperatives, whereas when assuming variable returns to scale (VRS), these differences are not statistically significant. For inefficient dairies, we observe the greatest potential for improvement in labor costs and depreciation. Both cooperatives and non-cooperatives operate mostly under decreasing returns to scale. Thus, the potential for enhancing the technical efficiency of dairies through the consolidation process seems to be exploited. Our findings reveal that the technical efficiency of dairies in Poland is not differentiated by regional milk production potential.

Suggested Citation

  • Katarzyna Ziętek-Kwaśniewska & Maria Zuba-Ciszewska & Joanna Nucińska, 2022. "Technical Efficiency of Cooperative and Non-Cooperative Dairies in Poland: Toward the First Link of the Supply Chain," Agriculture, MDPI, vol. 12(1), pages 1-22, January.
    • Handle: RePEc:gam:jagris:v:12:y:2022:i:1:p:52-:d:716109
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    References listed on IDEAS

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    1. Hooks, Teresa & Macken-Walsh, Áine & McCarthy, Olive & Power, Carol, 2017. "Farm-level viability, sustainability and resilience: a focus on co-operative action and values-based supply chains," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 119(3), December.
    2. Lukáš Čechura & Zdeňka Žáková Kroupová, 2021. "Technical Efficiency in the European Dairy Industry: Can We Observe Systematic Failures in the Efficiency of Input Use?," Sustainability, MDPI, vol. 13(4), pages 1-19, February.
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    Cited by:

    1. Han Zhang & Dongli Wu, 2023. "The Impact of Agricultural Factor Inputs, Cooperative-Driven on Grain Production Costs," Agriculture, MDPI, vol. 13(10), pages 1-17, October.
    2. Adoración Mozas Moral & Domingo Fernández Uclés, 2022. "The Agricultural Cooperative in the Face of the Challenges of Globalization, Sustainability and Digitalization," Agriculture, MDPI, vol. 12(3), pages 1-3, March.
    3. Zuba-Ciszewska Maria, 2023. "The role of state aid for the food industry – Based on the example of dairies in Poland," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 59(2), pages 101-116, June.
    4. Leonidas Sotirios Kyrgiakos & Georgios Kleftodimos & George Vlontzos & Panos M. Pardalos, 2023. "A systematic literature review of data envelopment analysis implementation in agriculture under the prism of sustainability," Operational Research, Springer, vol. 23(1), pages 1-38, March.

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