IDEAS home Printed from
   My bibliography  Save this article

Short-Run Returns to Scale, Farm-Size, and Economic Efficiency


  • Kumbhakar, Subal C


This paper analyzes the effects of returns to scale, farm-size, technical, allocative, and scale inefficiencies on the profitability of Utah dairy farms. It derives the conditions necessary to compare the profitability of farms within and between different size classifications as small, medium, and large. Some comparative static results regarding increases in input prices and a decrease or withdrawal of price support on profitability of small, medium, and large farms are presented. Copyright 1993 by MIT Press.

Suggested Citation

  • Kumbhakar, Subal C, 1993. "Short-Run Returns to Scale, Farm-Size, and Economic Efficiency," The Review of Economics and Statistics, MIT Press, vol. 75(2), pages 336-341, May.
  • Handle: RePEc:tpr:restat:v:75:y:1993:i:2:p:336-41

    Download full text from publisher

    File URL:
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See for details.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    1. Mehra, Rajnish & Prescott, Edward C., 1985. "The equity premium: A puzzle," Journal of Monetary Economics, Elsevier, vol. 15(2), pages 145-161, March.
    2. Hall, Robert E, 1978. "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 86(6), pages 971-987, December.
    3. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-1054, July.
    4. Diebold, Francis X & Rudebusch, Glenn D, 1991. "Is Consumption Too Smooth? Long Memory and the Deaton Paradox," The Review of Economics and Statistics, MIT Press, vol. 73(1), pages 1-9, February.
    5. Joseph G. Haubrich & Andrew W. Lo, "undated". "The Sources and Nature of Long-Term Memory in the Business Cycle," Rodney L. White Center for Financial Research Working Papers 05-89, Wharton School Rodney L. White Center for Financial Research.
    6. John Campbell & Angus Deaton, 1989. "Why is Consumption So Smooth?," Review of Economic Studies, Oxford University Press, vol. 56(3), pages 357-373.
    7. Stephen P. Zeldes, 1989. "Optimal Consumption with Stochastic Income: Deviations from Certainty Equivalence," The Quarterly Journal of Economics, Oxford University Press, vol. 104(2), pages 275-298.
    8. Phillips, P C B, 1987. "Time Series Regression with a Unit Root," Econometrica, Econometric Society, vol. 55(2), pages 277-301, March.
    9. Quah, Danny, 1990. "Permanent and Transitory Movements in Labor Income: An Explanation for "Excess Smoothness" in Consumption," Journal of Political Economy, University of Chicago Press, vol. 98(3), pages 449-475, June.
    10. West, Kenneth D., 1988. "The insensitivity of consumption to news about income," Journal of Monetary Economics, Elsevier, vol. 21(1), pages 17-33, January.
    11. Alan J. Auerbach & Kevin Hassett, 1991. "Corporate Savings and Shareholder Consumption," NBER Chapters,in: National Saving and Economic Performance, pages 75-102 National Bureau of Economic Research, Inc.
    12. Newey, Whitney & West, Kenneth, 2014. "A simple, positive semi-definite, heteroscedasticity and autocorrelation consistent covariance matrix," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 33(1), pages 125-132.
    13. Phillips, P C B, 1987. "Time Series Regression with a Unit Root," Econometrica, Econometric Society, vol. 55(2), pages 277-301, March.
    14. Flavin, Marjorie A, 1981. "The Adjustment of Consumption to Changing Expectations about Future Income," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 974-1009, October.
    15. Nelson, Charles R. & Plosser, Charles I., 1982. "Trends and random walks in macroeconmic time series : Some evidence and implications," Journal of Monetary Economics, Elsevier, vol. 10(2), pages 139-162.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Ila Alam & Robin Sickles, 1998. "The Relationship Between Stock Market Returns and Technical Efficiency Innovations: Evidence from the US Airline Industry," Journal of Productivity Analysis, Springer, vol. 9(1), pages 35-51, January.
    2. Sabine Duvaleix-Tréguer & Carl Gaigné, 2016. "On the nature and magnitude of cost economies in hog production," Agricultural Economics, International Association of Agricultural Economists, vol. 47(4), pages 465-476, July.
    3. Kaddour Hadri & Julie Whittaker, 1999. "Efficiency, Environmental Contaminants and Farm Size: Testing for Links Using Stochastic Production Frontiers," Journal of Applied Economics, Universidad del CEMA, vol. 2, pages 337-356, November.
    4. Kang, Hye-Jung & Lee, Hyunok & Sumner, Daniel A., 2003. "Heterogeneity In Production Technology Across Farm Sizes: Analysis Of Multi-Output Production Function Using Korean Farm-Level Panel Data," 2003 Annual meeting, July 27-30, Montreal, Canada 22245, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Xiaoheng Zhang & Feng Chu & Xiaohua Yu & Yingheng Zhou & Xu Tian & Xianhui Geng & Jinyang Yang, 2017. "Changing Structure and Sustainable Development for China’s Hog Sector," Sustainability, MDPI, Open Access Journal, vol. 9(1), pages 1-15, January.
    6. Fertő, Imre, 2002. "A mezőgazdasági termelés szerkezetének változásai a fejlett országokban, II. Az üzemnagyság és a mérethozadék problémája a mezőgazdaságban
      [Changes in the structure of agricultural production in th
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(9), pages 760-773.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tpr:restat:v:75:y:1993:i:2:p:336-41. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Kristin Waites). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.