Technical efficiency of US dairy farms and federal government programs

Murova, Olga; Chidmi, Benaissa

doi:10.1080/00036846.2011.613772

Cited by 12 publications

(12 citation statements)

References 17 publications

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“…To be successful, they must be sufficient to ensure that the marginal value product of working on‐farm is at least as great as the off‐farm wage rate. The necessity of maintaining high TE for U.S. dairies to be profitable and competitive in the global market, as noted by Murova and Chidmi (), imply that policies which facilitate investment in affordable advanced technologies requiring less on‐farm management time by the farm household may also be beneficial.…”

Section: Discussionmentioning

confidence: 99%

“…Understanding the relationship between off‐farm work and TE is vital given the upward trend in farm households’ off‐farm labor supply and the necessity of maintaining high TE on U.S. farms for them to be profitable and competitive in the global market (Murova & Chidmi, ). Costs can decrease when efficiency improves (Mosheim & Lovell, ), and small farms’ higher production costs are often caused by inefficiency rather than by inadequate technology (Tauer & Mishra, ).…”

Section: Introductionmentioning

confidence: 99%

“…The main differences between DEA and SFA are that: (a) DEA is a deterministic method while SFA is a stochastic method which allows for statistical noise, and (b) DEA is nonparametric while SFA is parametric and requires specification of a functional form. Murova and Chidmi () compare these two methods in their analysis of TE of U.S. dairies and federal government programs using 2005 ARMS survey data. They find that both methods produce similar results for most of the variables considered.…”

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confidence: 99%

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Off‐farm work and technical efficiency on U.S. dairies

Sabasi

Shumway

Astill

2019

Agricultural Economics

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In this study, we investigate the impact of an increase in farm households' off-farm work on technical efficiency (TE) of U.S. dairies. We present a theoretical framework that implies that an increase in farm household off-farm work decreases TE. We use two nationally-representative samples of U.S. dairies (2010 and 2005 Agricultural Resource Management Surveys) and a parametric approach (stochastic frontier analysis) to empirically test the hypothesis. Results are generally consistent with the hypothesis and show that an increase in off-farm work by the farm household is associated with a significant decrease in TE. In addition, results show that there is a statistically significant difference in TE between small, medium, and large farms. Small farms are associated with significantly higher off-farm work and have lower TE than large farms, which implies that less off-farm work by households with larger farms is at least partially responsible for the evidence of economies of scale in the U.S. dairy industry.

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Section: Discussionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

mentioning

confidence: 99%

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Off‐farm work and technical efficiency on U.S. dairies

Sabasi

Shumway

Astill

2019

Agricultural Economics

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“…A high level of technical efficiency, producing the maximum output for a given level of inputs, is important for farms to be both competitive and profitable (Murova & Chidmi, 2013;Lakner, Brenes-Muñoz, & Br€ ummer, 2017). Recent research has suggested that the regulatory environment may reduce farm-level competitiveness of aquaculture.…”

Section: Introductionmentioning

confidence: 99%

Effects of regulations on technical efficiency of U.S. baitfish and sportfish producers

Senten

Dey

Engle³

2018

Aquaculture Economics & Management

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The stringency of the regulatory environment has been shown to negatively affect the growth of aquaculture. A technical efficiency analysis of baitfish/sportfish production in the United States was performed using a stochastic production frontier model and a jointly estimated maximum-likelihood procedure (Frontier 4.1). Determinants of inefficiency were assessed for their relationship to farm efficiency. Mean technical efficiency for U.S. baitfish and sportfish producers was found to be 77%. Several regulatory variables were found to be significant in explaining the variation in levels of efficiency, including the number of annual renewals of permits and licenses and the amount of manpower required to comply with regulations. Results support the hypothesis that the current regulatory environment in the United States has reduced efficiency and economic competitiveness of baitfish and sportfish producers.

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“…For example, Lambarraa and Kallas () and Ranjan et al () find that program payments have a negative effect on farm technical efficiency. Murova and Chidmi () show that the Federal Milk Marketing Orders program for the U.S. dairy farms has a negative effect on the technical efficiency, while the Federal Milk Income Loss contract payments have a positive effect. Furthermore, studies that examined the effects of governmental subsidies on agricultural productivity and efficiency find mixed results.…”

Section: Introductionmentioning

confidence: 99%

Do Farm Support Programs Reward Production Inefficiency?

Hailu

Poon

2017

Canadian J Agri Economics

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Agricultural policy frameworks such as Growing Forward are intended to enhance the productivity and competitiveness of the Canadian agricultural sector and to stabilize farm income. This paper examines the relationship between production efficiency and government program payments. First, we find evidence of heterogeneity in production efficiency across farms. Second, we find a negative correlation between production efficiency and the share and level of program payments. The result of this study underscores the importance of understanding the link between technical inefficiency and government payments. Les cadres stratégiques agricoles comme Cultivons l'avenir existent pour favoriser la productivité et la compétitivité du secteur agricole canadien et pour stabiliser les revenus des exploitations agricoles. Cet article examine la relation entre l'efficience de la production et les programmes gouvernementaux de paiements. En premier lieu, nous avons trouvé des preuves d'hétérogénéité dans l'efficience de la production dans toutes les exploitations agricoles. Ensuite, nous avons identifié une corrélation négative entre la production efficiente,et la part et niveau des programmes de paiements. Le résultat de cette étude met en relief l'importance de comprendre le lien entre les inefficiences techniques et les paiements gouvernementaux.

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Technical efficiency of US dairy farms and federal government programs

Cited by 12 publications

References 17 publications

Off‐farm work and technical efficiency on U.S. dairies

Off‐farm work and technical efficiency on U.S. dairies

Effects of regulations on technical efficiency of U.S. baitfish and sportfish producers

Do Farm Support Programs Reward Production Inefficiency?

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