Alternative stochastic specifications of the frontier production function in the analysis of agricultural credit programs and technical efficiency

doi:10.1016/0304-3878(86)90044-1

Journal of Development Economics

Volume 21, Issue 1, April 1986, Pages 149-160

https://doi.org/10.1016/0304-3878(86)90044-1 Get rights and content

Abstract

The effect of subsidized credit on the technical efficiency of traditional farmers in Southeastern Brazil is analyzed under two alternative stochastic specifications for the production frontier. It is found that the choice of stochastic specification significantly influences inferences regarding the effect of subsidized credit on measured technical efficiency.

References (25)

D.W. Adams
Agricultural credit in Latin America: A critical appraisal of external funding policy
American Journal of Agricultural Economics
(1971)
S.N. Afriat
Efficiency estimation of production functions
International Economic Review
(1972)
D.J. Aigner et al.
On estimating the industry production function
American Economic Review
(1968)
D.J. Aigner et al.
Formulation and estimation of stochastic frontier production function models
Journal of Econometrics
(1977)
P. Araujo et al.
Agricultural credit policy in Brazil
Objectives and results, Savings and Development
(1978)
H.E. Drummond
An economic analysis of farm enterprise diversifications and associated factors in two regions of Midas Gerais, Brazil
M.J. Farrell
The measurement of productive efficiency
Journal of the Royal Statistical Society, Series A
(1957)
F.A. Forsund et al.
A survey of frontier production functions and of their relationship to efficiency measurement
Journal of Econometrics
(1980)
Fundacão Getulio Vargas (FGV), Centro de Estudos Agricolos,...
J.C. Garcia
Analise de alocaçao de recursos for proprietarion e parceiros em areas de agricultura de subsistencia

K.L. Graber

Factors explaining farm production and family earnings of small farmers in

W.H. Greene

Maximum likelihood estimation of econometric frontier functions

Journal of Econometrics

(1980)

Cited by (48)

Trajectories of efficiency measurement: A bibliometric analysis of DEA and SFA
2015, European Journal of Operational Research
Citation Excerpt :
For DEA research ‘real’ seminals are Sherman (1984), Berg, Førsund, Hjalmarsson, and Suominen (1993), Tyteca (1996), Coelli and Perelman (1999), Cooper, Park, and Yu (1999) and Seiford and Zhu (1999) as well as Banker and Kauffman (2004). For SFA literature (Fig. 7) Tyler and Lee (1979), Danilin, Materov, Rosefielde, and Lovell (1985), Taylor and Shonkwiler (1986), Dawson, Lingard, and Woodford (1991) and Sueyoshi (1991) as well as Banker (1993) are to be mentioned. Due to the two approaches (real and nominal seminals) several ‘must read’ articles for SFA and DEA research are identified.
This study surveys the increasing research field of performance measurement by making use of a bibliometric literature analysis. We concentrate on two approaches, namely Data Envelopment Analysis (DEA) and Stochastic Frontier Analysis (SFA) as the most important methods to evaluate the efficiency of individual and organizational performance. It is the first literature survey that analyses DEA and SFA publications jointly, covering contributions published in journals, indexed by the Web of Science database from 1978 to 2012. Our aim is to identify seminal papers, playing a major role in DEA and SFA development and to determine areas of adoption. We recognized a constant growth of publications during the years identifying DEA as a standard technique in Operations Research, whereas SFA is mainly adopted in Economic research fields. Making use of document co-citation analysis we identify Airports and Supplier Selection (DEA) as well as Banking and Agriculture (SFA) as most influential application areas. Furthermore, Sensitivity and Fuzzy Set Theory (DEA) as well as Bayesian Analysis and Heterogeneity (SFA) are found to be most influential research areas and seem to be methodological trends. By developing an adoption rate of knowledge we identify that research, in terms of citations, is more focusing on relatively old and recent research at the expenses of middle-aged contributions, which is a typical phenomenon of a fast developing discipline.
Impact of land fragmentation on rice producers' technical efficiency in South-East China
2010, NJAS - Wageningen Journal of Life Sciences
Rice farming is important for income generation in large parts of China and Asia. This paper uses detailed household, crop- and plot-level data to investigate the levels and determinants of rice producers’ technical efficiency for three villages with different characteristics in a major rice-growing area of South-East China, focusing in particular on the impact of land fragmentation. Empirical results obtained by applying a stochastic frontier model showed statistically significant differences in technology level among villages, with the remotest village having the lowest technology level. Within villages average technical efficiency was generally high, ranging from 0.80 to 0.91 for the three types of rice that are grown in the region. For late-rice producers, no statistically significant variation was found in their technical efficiencies. Land fragmentation was found to be an important determinant of technical efficiency in early-rice and one-season rice production. An increase in average plot size increased rice farmers’ technical efficiency. Given average plot size, an increase in the number of plots was found to increase technical efficiency, indicating the presence of variation effects. A larger distance between homesteads and plots contributed to technical inefficiency in early-rice production. The high levels of technical efficiency found in our study support the view that to raise rice productivity in the long run, new technologies need to be introduced.
FACTORS AFFECTING TECHNICAL EFFICIENCY SCORES ESTIMATED FOR THE COTTON SECTOR OF THE HARRAN PLAIN IN TURKIYE: A STOCHASTIC FRONTIER ANALYSIS
2023, Journal of Engineering and Technology for Industrial Applications
Impacts of the use of biological pest control on the technical efficiency of the Brazilian agricultural sector
2023, International Journal of Environmental Science and Technology
Green-Biased Technical Change and Its Influencing Factors of Agriculture Industry: Empirical Evidence at the Provincial Level in China
2022, International Journal of Environmental Research and Public Health
Impact of pest control trusteeship on technical efficiency: From the perspective of horizontal division efficiency and vertical coordination efficiency
2022, Resources Science

View all citing articles on Scopus

View full text

Alternative stochastic specifications of the frontier production function in the analysis of agricultural credit programs and technical efficiency

Abstract

Agricultural credit in Latin America: A critical appraisal of external funding policy

American Journal of Agricultural Economics

Efficiency estimation of production functions

International Economic Review

On estimating the industry production function

American Economic Review

Formulation and estimation of stochastic frontier production function models

Journal of Econometrics

Agricultural credit policy in Brazil

Objectives and results, Savings and Development

An economic analysis of farm enterprise diversifications and associated factors in two regions of Midas Gerais, Brazil

The measurement of productive efficiency

Journal of the Royal Statistical Society, Series A

A survey of frontier production functions and of their relationship to efficiency measurement

Journal of Econometrics

Analise de alocaçao de recursos for proprietarion e parceiros em areas de agricultura de subsistencia

Factors explaining farm production and family earnings of small farmers in

Maximum likelihood estimation of econometric frontier functions

Journal of Econometrics