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The Significance of Market Transaction Costs, Technical Efficiency and Risk in Agriculture: An Empirical Analysis for Tatarstan Republic

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  • Hockmann, Heinrich
  • Gataulina, Ekaterina

Abstract

The paper investigates the significance of risk, external and internal transaction costs in the agriculture of the Tatarstan Republic. The analysis is conducted for two categories of organ-isational forms, independent farms and members of agroholdings. Although average prices do not differ among organisational forms, the results indicate that external transaction costs are more pronounced in independent farms, whereas agroholding membership entails higher in-ternal transaction costs, thereby making agroholdings more vulnerable to inefficiency than independent farms. In addition, the estimation suggests that this higher inefficiency results from the more enhanced risk management in agroholding members. Since this strategy leads to a more intensive factor use, members of business groups are able to allocate inputs so as to increase production at the same time.

Suggested Citation

  • Hockmann, Heinrich & Gataulina, Ekaterina, 2012. "The Significance of Market Transaction Costs, Technical Efficiency and Risk in Agriculture: An Empirical Analysis for Tatarstan Republic," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126676, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae12:126676
    DOI: 10.22004/ag.econ.126676
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    References listed on IDEAS

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    1. Raushan Bokusheva & Heinrich Hockmann, 2006. "Production risk and technical inefficiency in Russian agriculture," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 33(1), pages 93-118, March.
    2. Hockmann, Heinrich & Bokusheva, Raushan & Bezlepkina, Irina V., 2007. "Agroholdings membership: does that make a difference in performance?," 102nd Seminar, May 17-18, 2007, Moscow, Russia 10023, European Association of Agricultural Economists.
    3. Ulrich Koester, 2005. "A revival of large farms in Eastern Europe—how important are institutions?," Agricultural Economics, International Association of Agricultural Economists, vol. 32(s1), pages 103-113, January.
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    5. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
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    Risk and Uncertainty;

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