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Can We Improve Farm Performance? The Determinants of Farm Technical and Environmental Efficiency

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  • Bouali Guesmi
  • Teresa Serra

Abstract

The environmental impacts of economic activities have become an important aspect in the evaluation of their overall performance. Consistently, traditional measures of technical efficiency have been extended to assess both the economic and environmental performance of firms. This study aims to use these measures to analyze the performance of a sample of Catalan arable crop farms. Specifically, we apply the methodology recently developed by Coelli et al. (2007) and Murty et al. (2012), and extend it to a consideration of the stochastic conditions under which production takes place as proposed by Chambers and Quiggin (1998 and 2000). Results suggest that efficiency ratings depend on model specification. Also, ignoring the stochastic nature of production yields downward-biased efficiency scores. Empirical findings suggest that environmental and technical efficiency are strongly interrelated indicating that an efficient use of chemical inputs improves both environmental and technical performance of farms.

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  • Bouali Guesmi & Teresa Serra, 2015. "Can We Improve Farm Performance? The Determinants of Farm Technical and Environmental Efficiency," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 37(4), pages 692-717.
    • Handle: RePEc:oup:apecpp:v:37:y:2015:i:4:p:692-717.
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    References listed on IDEAS

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    1. Boris Bravo-Ureta & Daniel Solís & Víctor Moreira López & José Maripani & Abdourahmane Thiam & Teodoro Rivas, 2007. "Technical efficiency in farming: a meta-regression analysis," Journal of Productivity Analysis, Springer, vol. 27(1), pages 57-72, February.
    2. Alfons Weersink & Calum G. Turvey & Abdulahi Godah, 1990. "Decomposition Measures of Technical Efficiency for Ontario Dairy Farms," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 38(4), pages 1023-1023, December.
    3. Madau, Fabio A., 2007. "Technical Efficiency in Organic and Conventional Farming: Evidence from Italian Cereal Farms," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 8(1), pages 1-17, January.
    4. Alfons Weersink & Calum G. Turvey & Abdulahi Godah, 1990. "Decomposition Measures of Technical Efficiency for Ontario Dairy Farms," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 38(4), pages 1023-1023, December.
    5. Jaume Puig & Josep M. Argilés, 2000. "Measuring and explaining farm inefficiency in a panel data set of mixed farms," Economics Working Papers 503, Department of Economics and Business, Universitat Pompeu Fabra.
    6. Moro, Daniele & Sckokai, Paolo, 1999. "Modelling the CAP Arable Crop Regime in Italy : Degree of Decoupling and Impact of Agenda 2000," Cahiers d'Economie et de Sociologie Rurales (CESR), Institut National de la Recherche Agronomique (INRA), vol. 53.
    7. Chambers,Robert G. & Quiggin,John, 2000. "Uncertainty, Production, Choice, and Agency," Cambridge Books, Cambridge University Press, number 9780521622448.
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    1. Skevas, Ioannis & Zhu, Xueqin & Shestalova, Victoria & Emvalomatis, Grigorios, 2018. "The Impact of Agri-Environmental Policies and Production Intensification on the Environmental Performance of Dutch Dairy Farms," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 43(3), September.
    2. Czyżewski, Bazyli & Kryszak, Łukasz, 2023. "Can a pursuit of productivity be reconciled with sustainable practices in small-scale farming? – Evidence from central and eastern Europe," MPRA Paper 117642, University Library of Munich, Germany, revised 31 May 2023.
    3. Zhu, Liyun & Schneider, Kevin & Oude Lansink, Alfons, 2023. "Economic, environmental, and social inefficiency assessment of Dutch dairy farms based on the dynamic by-production model," European Journal of Operational Research, Elsevier, vol. 311(3), pages 1134-1145.
    4. Amer Ait Sidhoum, 2023. "Measuring farm productivity under production uncertainty," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 67(4), pages 672-687, October.
    5. Bouali Guesmi & Ahmed Yangui & Ibtissem Taghouti & José Maria Gil, 2022. "Trade-Off between Land Use Pattern and Technical Efficiency Performance: Evidence from Arable Crop Farming in Tunisia," Land, MDPI, vol. 12(1), pages 1-13, December.
    6. West, Steele, 2021. "The Estimation of Farm Business Inefficiency in the Presence of Debt Repayment," 2021 Conference, August 17-31, 2021, Virtual 315048, International Association of Agricultural Economists.
    7. Amer Ait Sidhoum & Philipp Mennig & Johannes Sauer, 2023. "Do agri-environment measures help improve environmental and economic efficiency? Evidence from Bavarian dairy farmers," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 50(3), pages 918-953.
    8. Huang, Wei & Bruemmer, Bernhard & Huntsinger, Lynn, 2016. "Incorporating measures of grassland productivity into efficiency estimates for livestock grazing on the Qinghai-Tibetan Plateau in China," Ecological Economics, Elsevier, vol. 122(C), pages 1-11.

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