INPROFORUM 2007

Investigation of slovak farms efficiency in different production regions - stochastic frontier analysis
Zlata Sojková, Zlata Kropková, Vladimír Benda

Language: sk
Last modified: 2014-05-19

Abstract


The efficiency measure of selected Slovak farms operating in the different production conditions with the using of parametric approach is investigated in the paper. The econometric model is specified with the application of stochastic frontier analysis with Cobb-Douglas production function for the estimation of output oriented technical efficiency of Slovak farms. Data set included 79 Slovak farms operating in different regions in 2003-2005 time periods from Slovak Chamber of agriculture and food. The different character of production conditions is implemented in the econometric model with dummy variables. Based on the production conditions, the investigated Slovak farms are classified into two groups: farms operating in a better production conditions – productive region and farms operating less favourable area - LFA region. Following input variables are included in the model: capital, material, labour and agricultural land. Total output was used as output variable. From the achieved results we can conclude that the significant statistical differences in average technical efficiency were detected only in year 2005 between the agricultural farms of mentioned production conditions. The higher level of variability, in technical efficiency was detected in Slovak farms operating in productive region compared to the technical efficiency of farms in LFA region.


Keywords


stochastic production frontier, panel data, output oriented technical efficiency, Cobb-Douglas production function

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