Technical Efficiency of Dairy Farms: A Stochastic Frontier Application on Dairy Farms in Jordan

Abstract

The present study was conducted to determine the level of technical efficiency of dairy producing farms in Jordan by applying the stochastic production frontier (SPF) methodology. Technical efficiency estimates were generated for 100 dairy farms in Jordan. The results of the study indicated that technical efficiency of milk production by most of dairy farms in Jordan is low. The mean technical efficiency was estimated to be only 39.5% for the sampled dairy farms. This means that an average farm in the sample could in principle increase its level of milk production by 60.5% using the current input quantities. The results also implies that the dairy farms in Jordan are producing milk to only about 40% of the potential frontier production levels of this industry, implying that the production is about 60% below the frontier due to technical inefficiency. To enhance farm efficiency there is a need to improve farmers' access to extension services. The need to involve farmers more in the extension process itself should be encouraged.

Technical Efficiency and Its Determinant Factors of Dairy Farms under Membership of Different Scales of Cooperative in Bogor District, West Java

“…It denotes that herd size had an inverse relationship with farming efficiency, which means that the increase of herd size, will reduce the efficiency of dairy farms. This result conversely with the results of studies by Demircan et al (2010) and Al-Sharafat (2013). The possible explanation for this result was the composition of herd consist of more nonlactating cows than lactating cows.…”

Technical Efficiency of Milk Producers in Cattle Corridor of Uganda: Kiboga District Case

“…Rural milk producers need to be able to read labels on veterinary drugs especially expiry dates. Several studies have observed a statistically significant and positive relationship between education and efficiency [23]- [27]. Education level therefore, was expected to have a positive effect on technical efficiency of milk producers though it may not do much to affect technical efficiency because majority of milk producers in cattle corridor receive practical skills on cattle operations and management from childhood.…”

Estimation of technical efficiency of dairy farms in central zone of Tigray National Regional State

“…According to Ali Al-Sharafat (2013) Number of cows, feed intake and labor man days affect level of output of milk production positively while value of veterinary services, fixed inputs and depreciation costs have no significant impact on level of output of milk production. Education, herd size (cows) and experience affects efficiency in milk production positively while contact with extension service does not affect efficiency in milk production.…”

“…It means that some literatures reported some factors which affect output level and technical efficiency level of dairy farmer households either positively or negatively while others reported the same variables to have no impact on output level and efficiency level of dairy farmer households. For instance, as of Ali Al-Sharafat (2013), Bardhan and Sharma (2013) and Adane et al., (2015) veterinary cost has no impact, but positive impact as of Nega and Simeon (2006) on amount of milk produced. Labor input has positive impact on amount of milk produced as found in Ali Al-Sharafat (2013) and Adane et al.…”