Agricultural Policies and Structural Change in French Dairy Farms: A Nonstationary Markov Model

Arfa, Nejla Ben; Daniel, Karine; Jacquet, Florence; Karantininis, Kostas

doi:10.1111/cjag.12036

Cited by 17 publications

(9 citation statements)

References 40 publications

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“…Huettel and Jongeneel () as well as Zimmermann and Heckelei () suggest that supply rigidities, brought about by European Union milk quota policy, affect exit and scale through multiple channels. Consistent with studies on the role of subsidies in exit dynamics for farm businesses at large (Key and Roberts, ), evidence also exists that dairy policies have been scale‐biased, although these biases appear to be small in magnitude (Ben Arfa et al., ).…”

Section: Introductionsupporting

confidence: 55%

Technical efficiency, herd size, and exit intentions in U.S. dairy farms

Dong

Hennessy

Jensen

et al. 2016

Agricultural Economics

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The U.S. dairy industry has seen major restructuring in recent decades. A sharp decline in the number of U.S. dairy farms and an increase in average herd sizes have accompanied exits, which have been concentrated among smaller herds. Given that more productive farms are better positioned to increase operation size and to continue operation, we hypothesize that the more technically efficient farms are better able to expand and also have stronger incentives to continue production. Using data from the USDA's 2010 ARMS Phase III, Dairy Production Practices and Costs and Returns Report, we estimate technical efficiency using stochastic production frontier analysis with endogenous inputs. The efficiency estimate is then incorporated into the analysis of exit intention and herd size. The results confirm our hypotheses that smaller and less efficient farms are more likely to exit and that more efficient dairy farms tend to expand herd size. Moreover, farms without successors but with older and more educated operators are more likely to exit. JEL classifications: D2, J2, Q12

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Section: Introductionsupporting

confidence: 55%

Technical efficiency, herd size, and exit intentions in U.S. dairy farms

Dong

Hennessy

Jensen

et al. 2016

Agricultural Economics

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“…The application of latent class structures (LCM) results in a separation of the data into multiple technological classes. Each farm is then assigned to a specific class based on both the estimated technological (flexible TL function and the estimated probability relationships (Balcombe, Fraser and Kim, 2006 [10]; Sauer and Morrison Paul, 2013 [6]). Statistical tests are performed to choose the most adequate number of classes to be considered.…”

Section: Box 1 Measurement Of Productivity Definition Of Classes and Construction Of Indexesmentioning

confidence: 99%

“…Especially in France, the share of remaining coupled support was kept higher compared to other countries. The effect of a variation in the remaining share of coupled subsidies on farm productivity, technical change, resource allocation, innovativeness and sustainability can thus be studied comparing the performance of French farms to the performance of farms in the United Kingdom, 10 where decoupling was implemented more stringently. The different outcomes can be compared to a scenario without decoupling based on literature findings.…”

Section: Cap Pillar I Implementation Differences: England Versus Francementioning

confidence: 99%

Dynamics of farm performance and policy impacts: Case studies

Sauer

Chancellor

Mennig

et al. 2021

OECD Food, Agriculture and Fisheries Papers

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This paper provides detailed farm level data evidence on the dynamics of farm performance from case studies covering crop farms in Australia, France, Italy and the United Kingdom (England and Wales), and dairy farms in the Czech Republic, Denmark and Norway, with different recent sample periods of five to thirty years. An increase in productivity over time is common to all countries and most crop farm classes, but productivity dynamics vary significantly. In Australia, strong productivity growth among the most productive crop farms has led to an increase in the gap between the highest and lowest performing farms; whereas in France, Italy and the United Kingdom, productivity growth was weak among the most productive crop farms and the lowest performing farms closed the productivity gap. Productivity also increased among dairy farms, with an increasing gap between the most and the least productive farm classes in the three sample countries. The impact of policy changes on performance dynamics is analysed for decoupled payments in France and England, and dairy payments in the Czech Republic. The main findings across countries and policy implications are discussed in OECD Food, Agriculture and Fisheries Paper N°164.

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“…() showed in their review, it has become quite common in agricultural economics to study the way that farms experience size change by applying the so‐called Markov chain model (MCM) to aggregate series of farm numbers by size categories (see Huettel and Jongeneel (), Zimmermann and Heckelei () or Ben Arfa et al . () for recent examples). Although the MCM framework is essentially a statistical modelling approach, Stokes () showed that a Markovian transition process may be derived from a structural model of intertemporal profit maximization, giving theoretical grounds to using the MCM.…”

Section: Introductionmentioning

confidence: 98%

Movers and Stayers in The Farming Sector: Accounting for Unobserved Heterogeneity in Structural Change

Saint-Cyr

Piet

2016

Journal of the Royal Statistical Society Series C: Applied Statistics

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Summary The paper investigates whether accounting for unobserved heterogeneity in farms' size transition processes improves the representation of structural change in agriculture. Considering a mixture of two types of farm, the mover–stayer model is applied for the first time in an agricultural economics context. The maximum likelihood method and the expectation–maximization algorithm are used to estimate the model's parameters. An empirical application to a panel of French farms from 2000 to 2013 shows that the mover–stayer model outperforms the homogeneous Markov chain model in recovering the transition process and predicting the future distribution of farm sizes.

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Agricultural Policies and Structural Change in French Dairy Farms: A Nonstationary Markov Model

Cited by 17 publications

References 40 publications

Technical efficiency, herd size, and exit intentions in U.S. dairy farms

Technical efficiency, herd size, and exit intentions in U.S. dairy farms

Dynamics of farm performance and policy impacts: Case studies

Movers and Stayers in The Farming Sector: Accounting for Unobserved Heterogeneity in Structural Change

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