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Formal Participation in a Milk Supply Chain and Technical Inefficiency of Smallholder Dairy Farms in Pakistan

Author

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  • Abid A. Burki

    (Department of Economics, Lahore University of Management Sciences, Lahore.)

  • Mushtaq A. Khan

    (Department of Economics, Lahore University of Management Sciences, Lahore.)

Abstract

This paper provides empirical evidence on the impact on technical inefficiency of smallholder dairy producers when they formally participate in a milk supply chain. Here the stochastic production frontier and technical inefficiency effects model are estimated based on the data gathered from 800 smallholder dairy farms in Pakistan. The results suggest that the technical inefficiency of the participating farms is significantly reduced. A strong impact of the supply chain is also detected in reducing technical inefficiency of farms that are located in remote areas and on those that have larger herd-size. Experienced farmers upto the age of 36 years have the advantage of reducing technical inefficiency. The remaining differences in relative inefficiency of dairy farms are accounted for by severe long-term depressive disorders.

Suggested Citation

  • Abid A. Burki & Mushtaq A. Khan, 2011. "Formal Participation in a Milk Supply Chain and Technical Inefficiency of Smallholder Dairy Farms in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 50(1), pages 63-81.
  • Handle: RePEc:pid:journl:v:50:y:2011:i:1:p:63-81
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    File URL: http://www.pide.org.pk/pdf/PDR/2011/Volume1/63-81.pdf
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    Cited by:

    1. Tleubayev, Alisher & Bobojonov, Ihtiyor & Götz, Linde & Hockmann, Heinrich & Glauben, Thomas, 2017. "Determinants of productivity and efficiency of wheat production in Kazakhstan: A stochastic frontier approach
      [Determinanten von Produktivität und Effizienz der Weizenproduktion in Kasachstan: Ein
      ," IAMO Discussion Papers 160, Leibniz Institute of Agricultural Development in Transition Economies (IAMO).

    More about this item

    Keywords

    Agri-food Supply Chain; Production Frontiers; Dairy Efficiency; Food Policy; Pakistan;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy

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