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Heterogeneous Technologies as an Answer to Market and Price Risk: The Case of Kosovo

  • Sauer, Johannes
  • Davidova, Sophia
  • Gorton, Matthew

This paper empirically measures the prevalence of heterogeneous technologies in a sample of small-scale agricultural producers as an answer to structural conditions and market risks. Such risks are closely linked to the effects of land fragmentation and the degree of market integration. We use the empirical case of Kosovo as a transition country to investigate the efficiency effects of land fragmentation by simultaneously considering the effects of market integration. Different to previous studies, we assume that land fragmentation and market integration lead to the prevalence of heterogeneous technologies allowing farm households to respond more efficiently to exogenous price and policy shocks given their fragmentation and subsistence situation. The empirical work links the latent class frontier method to the estimation of a directional output distance function. We estimate beside primal technology measures also dual Morishima type elasticities of substitution investigating changes in production decisions based on relative shadow price changes.

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File URL: http://purl.umn.edu/122509
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Paper provided by European Association of Agricultural Economists in its series 123rd Seminar, February 23-24, 2012, Dublin, Ireland with number 122509.

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Date of creation: 23 Feb 2012
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Handle: RePEc:ags:eaa123:122509
Contact details of provider: Web page: http://www.eaae.org
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  1. Stern, David I, 2008. "Elasticities of Substitution and Complementarity," MPRA Paper 12454, University Library of Munich, Germany.
  2. Fare, Rolf & Grosskopf, Shawna & Noh, Dong-Woon & Weber, William, 2005. "Characteristics of a polluting technology: theory and practice," Journal of Econometrics, Elsevier, vol. 126(2), pages 469-492, June.
  3. Chen, Zhuo & Huffman, Wallace & Rozelle, Scott, 2006. "Farm Technology and Technical Efficiency: Evidence from Four Regions in China," Staff General Research Papers 12605, Iowa State University, Department of Economics.
  4. del Corral, Julio & Alvarez, Antonio & Tauer, Loren W., 2009. "Detecting Technological Heterogeneity in New York Dairy Farms," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49293, Agricultural and Applied Economics Association.
  5. Wu, Ziping & Liu, Minquan & Davis, John, 2005. "Land consolidation and productivity in Chinese household crop production," China Economic Review, Elsevier, vol. 16(1), pages 28-49.
  6. Luis Orea & Subal C. Kumbhakar, 2004. "Efficiency measurement using a latent class stochastic frontier model," Empirical Economics, Springer, vol. 29(1), pages 169-183, January.
  7. Graham, Mary & Fraser, Iain, 2003. "Scale Efficiency In Australian Dairy Farms," 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia 57878, Australian Agricultural and Resource Economics Society.
  8. Sauer, Johannes & Davidova, Sophia & Latruffe, Laure, 2010. "Determinants of smallholders’ decisions to leave land fallow: the case of Kosovo," 118th Seminar, August 25-27, 2010, Ljubljana, Slovenia 94917, European Association of Agricultural Economists.
  9. Laure Latruffe & Kelvin Balcombe & Sophia Davidova & Katarzyna Zawalinska, 2004. "Determinants of technical efficiency of crop and livestock farms in Poland," Applied Economics, Taylor & Francis Journals, vol. 36(12), pages 1255-1263.
  10. Rios, Ana R. & Masters, William A. & Shively, Gerald E., 2008. "Linkages between Market Participation and Productivity: Results from a Multi-Country Farm Household Sample," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6145, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  11. Jean-Paul Chavas & Ragan Petrie & Michael Roth, 2005. "Farm Household Production Efficiency: Evidence from The Gambia," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(1), pages 160-179.
  12. Greene, William, 2005. "Reconsidering heterogeneity in panel data estimators of the stochastic frontier model," Journal of Econometrics, Elsevier, vol. 126(2), pages 269-303, June.
  13. Sophia Davidova, 2011. "Semi‐Subsistence Farming: An Elusive Concept Posing Thorny Policy Questions," Journal of Agricultural Economics, Wiley Blackwell, vol. 62(3), pages 503-524, 09.
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