scholarly journals Dynamic efficiency in Lithuanian cereal farms

2016 ◽  
Vol 38 (2) ◽  
pp. 114-127 ◽  
Author(s):  
Tomas Baležentis
Keyword(s):  
Technical Efficiency ◽  
Structural Changes ◽  
Returns To Scale ◽  
Adjustment Cost ◽  
Scale Efficiency ◽  
Dynamic Efficiency ◽  
Family Farms ◽  
Technical Inefficiency ◽  
Efficiency Measures ◽  
Multi Temporal

Lithuanian family farms are subject to both production and investment support under the Common Agricultural Policy. As a result, there have been structural changes in the sector. Therefore, it is important to analyse farm performance from an adjustment cost perspective. The dynamic efficiency measures encompass multi-temporal cost minimisation. This paper addresses the following problem: what are the key trends in dynamic efficiency and what are the implications thereof on further development of cereal farming in Lithuania? The present paper aims to identify the prospective paths for development of Lithuanian cereal farms by analysing their dynamic efficiency. Data Envelopment Analysis is applied to calculate technical efficiency scores under different assumptions regarding returns to scale. The results indicate pure technical inefficiency remained as the main source of the overall technical inefficiency with scale inefficiency increasing throughout 2004–2014. A more detailed analysis showed that it was smaller farms that suffered from losses in the pure technical efficiency to the highest extent. The exit of the smaller cereal and oilseed farms, therefore, has likely contributed to the decreasing technical inefficiency, yet it has dampened scale efficiency.

scholarly journals A comparative study of efficiency and its determinants in Islamic, conventional, and socially responsible banks

2016 ◽  
Vol 13 (4) ◽  
pp. 470-482 ◽  
Author(s):  
Majed Alharthi
Keyword(s):  
Financial Crisis ◽  
Technical Efficiency ◽  
Returns To Scale ◽  
Scale Efficiency ◽  
Islamic Banks ◽  
Socially Responsible ◽  
Market Capitalization ◽  
Efficiency Measures ◽  
Conventional Banks ◽  
Constant Returns To Scale

This study empirically estimates efficiency and its determinants in 190 Islamic (IBs), conventional (CBs), and socially responsible banks (SRBs) in 22 countries during the period 2005-2012. The study first uses non-parametric approaches to estimate the efficiency measures (scale efficiency (SE), technical efficiency-constant returns to scale (CRS), and technical efficiency-variable returns to scale (VRS)) and second employs ordinary least squares, fixed effects, random effects, and TOBIT models to get the efficiency determinants. The findings indicate that the average efficiency is 0.966, 0.952, and 0.983 for the SE, CRS, and VRS, respectively. However, efficiency measures show that the SRBs are most efficient banks whereas, the least efficiency scores archived by Islamic banks. Islamic bank efficiency is positively correlated with size, loan intensity, ROA, inflation rates, market capitalization and financial crisis. However, conventional banks’ TE and CRS efficiency are positively and significantly correlated with size, ROA, and market capitalization, while their VRS efficiency is negatively and significantly related to capital ratio, age and GDP. In addition, SRBs’ efficiency is increased by size, capital ratio, loan intensity, ROA, foreign ownership, domestic ownership, inflation and financial crisis. Furthermore, the financial crisis affects the SE and CRS efficiency measures in Islamic banks while socially responsible banks SE efficiency measure is positively affected by the financial crisis, which means that socially responsible banks were stabled and resisted during the crisis period. Finally, there is no significant correlation between financial crisis and efficiency indictors in conventional banks during the period

Efficiency of glass firms in India: an application of data envelopment analysis

2016 ◽  
Vol 13 (1) ◽  
Author(s):  
Mini Kundi ◽  
Seema Sharma
Keyword(s):  
Data Envelopment Analysis ◽  
Technical Efficiency ◽  
Design Methodology ◽  
Large Scale ◽  
Returns To Scale ◽  
Scale Efficiency ◽  
Data Envelopment ◽  
Efficiency Measures ◽  
Target Values ◽  
Practical Implications

Purpose The purpose of the present study is to evaluate the efficiency of glass firms in India. Design/methodology/approach Data envelopment analysis (DEA) has been employed to study the technical, scale and super efficiency measures of glass firms in India. Findings Major findings of DEA analysis show that 65 percent firms are found to be technically efficient. Returns to scale analysis indicate that five firms are operating at decreasing returns to scale and two firms are exhibiting increasing returns to scale. Further, results show that small– and medium–scale firms are more efficient than large–scale firms. Old firms are more efficient compared to the young firms and foreign-owned firms are technically more efficient compared to the domestic firms. Practical implications The results of this study would help the managers to assess their relative efficiency and take corrective measures to efficiently use their resources. Originality/value This seems to be the first study to apply DEA to analyze the efficiency of glass firms in India. No previous study on glass industry seems to have decomposed the measure of overall technical efficiency into its components, namely pure technical efficiency and scale efficiency and no study seems to have examined whether ownership, age and size of a firm are significant for its efficiency. In addition, no earlier study seems to have ranked the glass firms based on their efficiency values. Further, target values of inputs and outputs are demonstrated in this study. Stability of efficiency scores is also checked.

scholarly journals Structural efficiency in Lithuanian family farms

2015 ◽  
Vol 37 (4) ◽  
pp. 462-479
Author(s):  
Tomas Baležentis
Keyword(s):  
Returns To Scale ◽  
Scale Efficiency ◽  
Family Farms ◽  
Technical Inefficiency ◽  
Structural Efficiency ◽  
Scale Size ◽  
Level Data ◽  
Farm Accountancy Data Network ◽  
Most Productive Scale Size ◽  
Research Period

Along with firm-specific technical inefficiency, sector-specific structural inefficiency might induce losses in productivity. This paper therefore aims to identify the trends in structural efficiency in Lithuanian family farms. Specifically, the four farming types are considered, namely cereal farming, field cropping, dairying, and mixed farming. Farm-level data from Farm Accountancy Data Network are used for the analysis. The research period spans over the years 2004–2011. The trends in technical and scale efficiency are presented. Furthermore, the prevailing returns to scale are discussed thus offering insights into the most productive scale size and deviations from it in Lithuanian family farms. Finally, the dynamics in structural efficiency are discussed. The results indicate that the aggregate output of certain farming types could be augmented by some 20–25% due to reallocation of inputs among farms. Anyway, technical inefficiency remains the major driver of structural inefficiency.

scholarly journals Decomposition of the technical efficiency of the banking system

2018 ◽  
Vol 11 (1) ◽  
Author(s):  
Sanderson Abel ◽  
Alex Bara ◽  
Pierre Le Roux
Keyword(s):  
Technical Efficiency ◽  
Commercial Banks ◽  
Returns To Scale ◽  
Banking System ◽  
Efficiency Score ◽  
Foreign Banks ◽  
Scale Efficiency ◽  
Data Envelopment ◽  
Analysis Method ◽  
Technical Inefficiency

The study investigated the technical efficiency of the commercial banks in Zimbabwe during the period 2009–2015. The study entailed the decomposition of the technical efficiency into pure technical and scale efficiency to understand the sources of the technical inefficiency in the commercial banks in Zimbabwe. To accomplish the task, the study sampled 11 commercial banks of which 6 are domestic and the other 5 are foreign banks. The study used the data envelopment analysis method. The results of the study revealed that commercial banks in Zimbabwe are technically inefficient with an efficiency score of 82.9%. The average pure technical and scale efficiency scores were 96.6% and 85.6%, respectively. The results imply that technical inefficiency of the Zimbabwean commercial banks is mainly a result of scale inefficiency emanating from decreasing returns to scale. The deduction is that commercial banks in Zimbabwe are operating at below their optimum capacity and hence have scope to increase their operations in order to improve on technical efficiency.

scholarly journals Does Farm Size and Specialization Matter for Productive Efficiency? Results from Kansas

2011 ◽  
Vol 43 (4) ◽  
pp. 515-528 ◽  
Author(s):  
Amin W. Mugera ◽  
Michael R. Langemeier
Keyword(s):  
Data Envelopment Analysis ◽  
Technical Efficiency ◽  
Production Technology ◽  
Returns To Scale ◽  
Productive Efficiency ◽  
Farm Size ◽  
Scale Efficiency ◽  
Data Envelopment ◽  
Sample Period ◽  
Analysis Techniques

In this article, we used bootstrap data envelopment analysis techniques to examine technical and scale efficiency scores for a balanced panel of 564 farms in Kansas for the period 1993–2007. The production technology is estimated under three different assumptions of returns to scale and the results are compared. Technical and scale efficiency is disaggregated by farm size and specialization. Our results suggest that farms are both scale and technically inefficient. On average, technical efficiency has deteriorated over the sample period. Technical efficiency varies directly by farm size and the differences are significant. Differences across farm specializations are not significant.

A Stochastic Frontier Analysis of Exporting Small and Medium Sized Enterprises in India

2016 ◽  
Vol 7 (3) ◽  
pp. 1-23
Author(s):  
Manoj Kumar
Keyword(s):  
Technical Efficiency ◽  
Stochastic Frontier Analysis ◽  
Stochastic Frontier ◽  
Returns To Scale ◽  
Key Factors ◽  
Technical Inefficiency ◽  
Frontier Analysis ◽  
Efficiency Performance ◽  
Size Firm ◽  
Almost All

This study employs a stochastic frontier analysis (SFA) and technical inefficiency effects model to predict the technical efficiency of 3,168 Indian manufacturing and exporting SMEs, analyze their returns to scale and key factors impacting on their technical efficiency. Indian manufacturing and exporting SMEs extensively rely on labor rather than capital to increase their output, including almost all exporting SME groups, except those exporting to North & South America. The production of Indian manufacturing SMEs exporting to Oceania, however, has increasing returns to scale (1.1965). The inefficiency effects model reveals that firm size, firm age, foreign ownership, location and government assistance are firm-specific factors that significantly affect the technical inefficiency of production. Finally, evidence-based policies are also provided to facilitate improvement in the technical efficiency performance of Indian manufacturing and exporting SMEs.

scholarly journals Risk Adjusted Production Efficiency of Maize Farmers in Ethiopia: Implication for Improved Maize Varieties Adoption

2017 ◽  
Vol 5 (9) ◽  
pp. 1099
Author(s):  
Sisay Diriba Lemessa ◽  
Molla Alemayehu Yismawu ◽  
Megersa Debela Daksa ◽  
Mulugeta Damie Watabaji
Keyword(s):  
Technical Efficiency ◽  
Production Efficiency ◽  
Stochastic Frontier ◽  
Returns To Scale ◽  
Stochastic Frontier Approach ◽  
Technical Inefficiency ◽  
Maize Production ◽  
Production Risk ◽  
Access To Credit ◽  
Maize Varieties

This study analyzes the technical efficiency and production risk of 862 maize farmers in major maize producing regions of Ethiopia. It employs the stochastic frontier approach (SFA) to estimate the level of technical efficiencies of stallholder farmers. The stochastic frontier approach (SFA) uses flexible risk properties to account for production risk. Thus, maize production variability is assessed from two perspectives, the production risk and the technical efficiency. The study also attempts to determine the socio-economic and farm characteristics that influence technical efficiency of maize production in the study area. The findings of the study showed the existence of both production risk and technical inefficiency in maize production process. Input variables (amounts per hectare) such as fertilizer and labor positively influence maize output. The findings also show that farms in the study area exhibit decreasing returns to scale. Fertilizer and ox plough days reduce output risk while labor and improved seed increase output risk. The mean technical efficiency for maize farms is 48 percent. This study concludes that production risk and technical inefficiency prevents the maize farmers from realizing their frontier output. The best factors that improve the efficiency of the maize farmers in the study area include: frequency of extension contact, access to credit and use of intercropping. It was also realized that altitude and terracing in maize farms had influence on farmer efficiency.

scholarly journals Efficiency of Micro and Small Enterprises in Ethiopia: Evidence from Data Envelope Analysis Model

2021 ◽  
Author(s):  
Abebe Birhanu Ayele
Keyword(s):  
Technical Efficiency ◽  
Service Sector ◽  
Returns To Scale ◽  
Least Square ◽  
Scale Efficiency ◽  
Small Enterprises ◽  
Analysis Model ◽  
Micro And Small Enterprises ◽  
The Government ◽  
Constant Returns To Scale

This study measures the technical and scale efficiency of Micro and Small Enterprises (MSEs) and input slacks using Data Envelop Analysis (DEA) model and identifies the determinants of efficiencies of MSEs by employing ordinary least square (OLS) econometrics model. A sample of 375 randomly selected MESs are included in the study. The study found that the average technical and scale efficiency of MSEs are relatively low; technical efficiency averaged at 30 percent and 38.4 percent under constant returns to scale (CRS) and variable returns to scale (VRS) assumptions, respectively. Besides, the overall average scale efficiency score of MSEs was estimated at 77.8 percent. The highest mean technical and scale efficiencies were registered in the construction (71.8 percent) and manufacturing (85.7 percent) sectors, respectively. Whereas, the lowest technical and scale efficiency goes to urban agriculture sector and service sector, with 38.9 percent and 67.2 percent, respectively. The level of inputs, enterprise age and sector, human capital, labor productivity variables significantly affect relative technical efficiency level of MSEs with different directions while variables such as start-up capital, gender of the enterprise manager and availability of support from the government identified statistically not significant in determining the MSEs’ technical efficiency.

scholarly journals Technical Efficiency and Production Risk of Rice Farms under Anchor Borrowers Programme in Kebbi State, Nigeria

2019 ◽  
pp. 1-12
Author(s):  
A. H. Kara ◽  
M. N. Shamsudin ◽  
Z. Mohamed ◽  
I. B. Latiff ◽  
K. W. K. Seng
Keyword(s):  
Technical Efficiency ◽  
Stochastic Frontier ◽  
Returns To Scale ◽  
Policy Option ◽  
Risk Averse ◽  
Technical Inefficiency ◽  
Production Risk ◽  
Cultivation Technique ◽  
Land Cultivation ◽  
The Mean

This study estimates technical efficiency and production risk of rice farms under Anchor Borrowers Programme (ABP) in Kebbi State, Nigeria. The study employed Stochastic Frontier Production (SFA) with flexible risk specifications to a sample of 231 rice producers surveyed in 2016 production season. The findings shows that seed, fertilizer, agrochemicals and labour inputs influenced rice output positively. The production technology characterizing rice farms in the study area exhibit increasing returns to scale. Fertilizer and agrochemicals are estimated to decrease variance of the value of output while seed and labour are estimated to increase the variance of the value of output. This implies that a risk-averse farmer will use more of fertilizer and agrochemicals and less of seed and labour than a risk neutral farmer. The mean technical efficiency estimates was 85.3 percent. Several characteristics of the farmers such as education, farming experience, extension contact, land cultivation technique and planting technique significantly decrease technical inefficiency of the farmers. The study concludes that, on the average 14.7 percent of potential output is lost due to technical inefficiency and production risk in inputs and recommends the use of best farm practice to produce rice efficiently. Policy option should also consider the incorporation of production risk in technical efficiency analysis if the inputs are non-neutral in risk.

scholarly journals Production and scale efficiency of South African water utilities: the case of water boards

Water Policy ◽  
2021 ◽  
Author(s):  
Victor Ngobeni ◽  
Marthinus C. Breitenbach
Keyword(s):  
South Africa ◽  
Technical Efficiency ◽  
Returns To Scale ◽  
Water Utilities ◽  
Scale Efficiency ◽  
Undesirable Output ◽  
Water Losses ◽  
Water Board ◽  
Bad Outputs ◽  
Water Boards

Abstract South Africa is a water scarce country with deteriorating water resources. Faced with tight fiscal and water resource constraints, water utilities would have to adopt technically efficient water management technologies to meet developmental socio-economic objectives of universal coverage, aligned to the United Nation's Sustainable Development Goal 6. It is important to measure the technical efficiency of utilities as accurately as possible in order to inform policy. We do this by using a non-parametric method known as Data Envelopment Analysis to determine, measure, analyse and benchmark the technical efficiency of all water boards in South Africa. Our contribution to the literature is twofold: This is the first paper to model technical efficiency of water boards as utility suppliers and guardians of water services in South Africa, and second, we address the over- and underestimation issues of technical efficiency measurement in the water sector. We do this by modelling one of the most pronounced negative externalities from water provision (water losses) as an undesirable output using the approach developed by You & Yan. We find, on average, technical efficiency of water boards is 49%, with only three of the nine water boards technically efficient. Six of the smaller water boards showed high levels of inefficiency with an inefficiency rate of 51%, which is equivalent to wastage in expenditure of R3.7 billion. Six water boards operate at increasing returns to scale and two are scale efficient. Only Rand and Sedibeng water boards exhibited decreasing returns to scale. Therefore, redirecting potential efficiency savings to optimal uses could result in technical and scale efficiency for the sector. Scale efficiency results seem to support larger regional water boards as small- to medium-sized water boards are scale inefficient with low technical efficiency. For example, Amatola Water (small water board) with an efficiency score of only 16% has a total expenditure of 18% of that of Umgeni (large water board), but sells only 6.7% of the quantity sold by Umgeni. Amatola also has seven times the proportion of water losses compared with Umgeni and charges 1.6 times the tariff of Umgeni. The ratio model with an undesirable output outperforms previous methods to deal with undesirable (bad) outputs, which either provide an over- or underestimation of technical efficiency.

Sign in / Sign up

Export Citation Format

Share Document