Stochastic translog profit frontier approach to measurement of profit inefficiency in yam production, Imo State, Nigeria

Economic Efficiency of Extensive and Intensive Shrimp Production under Conditions of Disease and Natural Disaster Risks in Khánh Hòa and Trà Vinh Provinces, Vietnam

“…Ali and Flinn [11] suggested that production levels might provide inaccurate measures of efficiency decisions, since farmers face different prices of inputs and outputs and varying levels of resource endowments in the production process. Upon this criticism, the stochastic profit frontier emerged as an alternative and was applied in a number of studies to estimate economic efficiency of individual farms [11,12,14,15]. The major advantage of using such restrictive profit functions lies in in the ease of obtaining closed-form algebraic formulae for costs of technical and allocative inefficiencies that are of primary concern to the producers.…”

“…Hence, researchers have proposed using the profit function, which encompasses both the TE and AE measurements, as an alternative for measuring economic efficiency related to farm decision making. Although researchers [11][12][13][14][15][16][17] have examined factors influencing shrimp profit efficiency among limited-resource farmers engaging in intensive and extensive shrimp production, none has considered the effects of climatic and risk conditions on farmer decision making. While there is optimism about shrimp production intensification as a means of enriching limited-resource farmers, doubts also persist about its sustainability because of associated risks related to production efficiency and losses resulting from diseases and natural disaster events.…”