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Measuring Productive Efficiency in Multiple Product Agribusiness Firms: A Dual Approach

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  • Jay T. Akridge

Abstract

Measuring retail fertilizer plant efficiency is difficult, given the range of outputs produced by these multiple product firms. A frontier multiproduct cost function was employed to measure productive efficiency. Results suggest the average plant could lower variable costs by 10% through more effective operations. Allocative inefficiency was minimal, indicating management should focus on improving technical efficiency. The limitations of employing a single-product model in a multiproduct situation are demonstrated.

Suggested Citation

  • Jay T. Akridge, 1989. "Measuring Productive Efficiency in Multiple Product Agribusiness Firms: A Dual Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(1), pages 116-125.
  • Handle: RePEc:oup:ajagec:v:71:y:1989:i:1:p:116-125.
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    File URL: http://hdl.handle.net/10.2307/1241780
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    Cited by:

    1. Liu, Jing & Bailey, DeeVon, 2013. "Examining Economies of Scale for Farmer Cooperatives in China’s Shanxi Province," Journal of Rural Cooperation, Hebrew University, Center for Agricultural Economic Research, vol. 41(2).
    2. G. Karagiannis & V. Tzouvelekas & A. Xepapadeas, 2003. "Measuring Irrigation Water Efficiency with a Stochastic Production Frontier," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 26(1), pages 57-72, September.
    3. Dhehibi, Boubaker, 2010. "Productive Efficiency in Water Usage: An Analysis of Differences among Citrus Producing Farms Sizes in Tunisia," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 97328, African Association of Agricultural Economists (AAAE);Agricultural Economics Association of South Africa (AEASA).
    4. Paul V. Preckel & Jay T. Akridge & Michael A. Boland, 1997. "Efficiency measures for retail fertilizer dealers," Agribusiness, John Wiley & Sons, Ltd., vol. 13(5), pages 497-509.
    5. Caputo, Michael R. & Lynch, Lori, 1993. "A Nonparametric Efficiency Analysis Of California Cotton Ginning Cooperatives," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 18(02), December.
    6. David G. Barton & Ted C. Schroeder & Allen M. Featherstone, 1993. "Evaluating the feasibility of local cooperative consolidations: A case study," Agribusiness, John Wiley & Sons, Ltd., vol. 9(3), pages 281-294.
    7. Dhehibi, Boubaker & Lachaal, Lassaad & Elloumi, Mohamed & Messaoud, Emna B., 2008. "Measuring Irrigation Water Efficiency with a Stochastic Production Frontier: An Application for Citrus Producing Farms in Tunisia," 2007 Second International Conference, August 20-22, 2007, Accra, Ghana 52166, African Association of Agricultural Economists (AAAE).
    8. Frija, Aymen & Chebil, Ali & Abdelkafi, Belhassen, 2012. "Irrigation water use efficiency in collective irrigated schemes of Tunisia: determinants and potential irrigation cost reduction," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 13(1), January.
    9. Chebil, Ali & Frija, Iheb & Bahri, Walid, 2014. "Irrigation water efficiency in wheat production in Chbika (Tunisia):Parametric versus Nonparametric Comparisons," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 15(1), January.
    10. Bravo-Ureta, Boris E. & Jara-Rojas, Roberto & Lachaud, Michee A. & Moreira L., Victor H. & Scheierling, Susanne M., 2015. "Water and Farm Efficiency: Insights from the Frontier Literature," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 206076, Agricultural and Applied Economics Association;Western Agricultural Economics Association.

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