Analysis of the Technical Efficiency of European Sea Bass Farms in Turkey: A Stochastic Frontier Production Function Approach

Abstract

This study’s main objective was to estimate sea bass farms’ technical efficiency and determine the factors affecting production inefficiency using the stochastic frontier approach. The data were collected using questionnaires from 71 farms in 2017. The total sea bass production cost was calculated 5.35 $ kg-1, income 5.65 $ kg-1, gross profit 0.30 $ kg-1. The proportion of variable costs (84.25%) in total costs was higher than the fixed costs (15.75%). The feed cost (57.56%) was the influential primary variable on the total costs, and the benefit-cost ratio was 1.06. The results indicated that seabass farms’ technical efficiency varied between 0.67 to 1.00, and the average was 0.82. The efficiency scores meant the farms could achieve the same production amount by reducing inputs by 18%. One per cent increase in resale value, feed amount, and fingerling amount, increase sea bass production by 0.4%, 0.4%, and 0.2%, respectively. Fish loss rates and subsidies were influential on inefficiency. It would be beneficial to minimize risk factors such as fish loss rates and carry out political and educational activities to improve farms’ infrastructure in breeding and marketing. As a result, policymakers should also include the effective use of production factors in the design of aquaculture subsidy policies.