An Analysis of the Technical Efficiency in Panel Stochastic Frontier Production Model of German States after Reunification of Germany

2019 ◽  
Vol 37 (4) ◽  
pp. 129-146
Author(s):  
Dalwon Kang
Keyword(s):  
Technical Efficiency ◽  
Stochastic Frontier ◽  
Production Model ◽  
German States

scholarly journals Technical Efficiency of the Malaysian Wooden Furniture Industry: A Stochastic Frontier Production Approach

2010 ◽  
Vol 3 (3) ◽  
pp. 10 ◽  
Author(s):  
Alias Radam ◽  
Mohd Rusli Yacob ◽  
Huda Farhana Mohd Muslim
Keyword(s):  
Technical Efficiency ◽  
Manufacturing Sector ◽  
Stochastic Frontier ◽  
Production Model ◽  
Furniture Industry ◽  
Conventional View ◽  
Maximal Output ◽  
Wood Furniture ◽  
Wooden Furniture ◽  
Medium Firms

Wood furniture industry is an important component in our manufacturing sector for it significantly contributes to the industrialization of Malaysia’s economy. Evaluating wood furniture industry’s level of efficiency is important to assist and provide a relative direction to small and medium firms on their business. The objective of this research is to examine the efficiency of wooden furniture industry by determining the technical efficiency using stochastic frontier production model. Results show that firm output is 54 per cent less than the maximal output which can be achieved from the existing inputs. The technical inefficiency on individual firm varies from 1.63 to 94.69 per cent and so does the potential to increase firm output from the existing inputs. This evidence suggests that many firms still operate below the efficiency level, confirming the conventional view that labor-intensive firms are most likely inefficient.

scholarly journals Formation and Efficient Estimation of Stochastic Frontier Production Function

2021 ◽  
Vol 9 (4) ◽  
Author(s):  
N. J Dhanesh
Keyword(s):  
Technical Efficiency ◽  
Production Function ◽  
Stochastic Frontier ◽  
Efficient Estimation ◽  
Production Functions ◽  
Production Model ◽  
Stages Of Growth ◽  
Stochastic Frontier Production Function ◽  
Plantation Crops ◽  
Frontier Production Function

Technological change and efficiency improvement are important sources of productivity growth in any economy. The concept of technical efficiency (TE) is based on input and output relationships. Technical inefficiency arises when actual or observed output from a given input mix is less than a possible mix. The analysis of technical efficiency involves the assessment of the degree to which the production technologies are utilized. The present investigation on “Formation and efficient estimation of stochastic frontier production functions” was carried out in the Department of Agricultural Statistics, College of Horticulture, Vellanikkara, during 2010 -13. To assess the present economics of pepper cultivation, to formulate a new stochastic frontier production function and to compare different stochastic frontier production functions. The secondary data on the area of holdings, number of vines, yield, expenses for machinery, labour, manure, and other expenses for the cultivation of the major spice pepper collected from the Department of Plantation Crops and Spices, College of Horticulture, Vellanikkara were used for the analysis. For the stochastic frontier production model to be realistic, an exact measurement of the cost of the inputs and the realized output is extremely necessary. Very few farmers keep records of the expenditure incurred on the various inputs and rarely the output realized. Vegetable crops have a short duration. So the farmer will be in a position to give realistic figures regarding the various inputs as also the outputs. As regards plantation crops, there will be a lag right from the establishment of the crop to the steady bearing stage. Therefore, it will be very difficult to trace back the exact cost, as no records would be available about the costs incurred. Therefore, a rapid estimation survey is the only feasibility wherein simultaneous estimation of the costs involved from the nursery through the various stages of growth can be observed. Since a farmer who is already having a steady-bearing crop would have incurred lesser costs through the previous stages of growth of the crop, it is most feasible to use the concept of present worth to arrive at the exact costs of previous stages of the crop. The stochastic frontier analysis was done using the present value (PV) and the present cost.

scholarly journals Farmers’ Efficiency Enhancement Through Input Management: The Issue Of USG Application In Modern Rice

1970 ◽  
Vol 36 (1) ◽  
pp. 129-141 ◽  
Author(s):  
M Shahe Alam ◽  
M Saiful Islam ◽  
MA Islam
Keyword(s):  
Technical Efficiency ◽  
Proper Time ◽  
Stochastic Frontier ◽  
Crop Management ◽  
Rice Production ◽  
Production Model ◽  
Rice Farmers ◽  
Prilled Urea ◽  
Production Environments ◽  
Yield Gain

A socio-economic study was carried out in two rice production environments (Gazipur and Tangail) to assess the comparative advantages of using urea super granule (USG) over prilled urea (PU) in modern rice production and to examine the differences in producers’ technical efficiency between USG user and non- user in crop management. Stochastic frontier production model was employed to examine the farm specific technical efficiency difference in crop management between USG and PU users in the study areas. Analysis revealed that comparatively low amount (36%) of urea was needed in modern boro rice production using USG instead of PU. Nearly 366 % more labour was needed in the USG using plots compared to that of PU user plots, while weeding cost was a bit lower in USG using plots. Analysis also indicated that the sample farmers were able to achieve additional yield of 0.87 t/ha by using USG and this yield gain further resulted to additional benefit of Tk. 11506/ha. For the resource poor rice farms, this benefit is considered to be substantive. Farmers’ contact with the technology disseminators, training on rice production and the use of USG (instead of PU) were the important factors of increasing rice farmers’ technical efficiency in crop management and productivity enhancement as well. According to the farmers’ opinion, there were several constraints in using USG and out of those, requirement of more labour and non availability of USG in proper time were the dominant ones. Keywords: Urea super granule; prilled urea; flood-prone ecosystem; technical efficiency; productivity. DOI: http://dx.doi.org/10.3329/bjar.v36i1.9237 BJAR 2011; 36(1): 129-141

scholarly journals Economic analysis of turmeric cultivation: evidence from Khagrachari district

2019 ◽  
Vol 44 (1) ◽  
pp. 43-58
Author(s):  
MEA Begum ◽  
MA Monayem Miah ◽  
MA Rashid ◽  
MT Islam ◽  
MI Hossain
Keyword(s):  
Higher Education ◽  
Technical Efficiency ◽  
Stochastic Frontier ◽  
Production Model ◽  
Extension Service ◽  
Good Source ◽  
Extension Services ◽  
Potential Output ◽  
Positive Effects ◽  
Net Benefits

Turmeric is a good source of income for hilly people of Bangladesh. The study estimated the profitability and technical efficiency of turmeric cultivation in Khagrachhari district. In total 150 turmeric farms located in Khagrachari Sadar, Panchari and Matiranga Upazilas of Khagrachari district, were surveyed. Data were collected, using a pre-tested questionnaire during January, 2015. The study revealed that turmeric farming is a profitable farming with some dominating variable costs like seed (rhizome) and sowing, harvesting and carrying. As the net return was Tk. 112139 per hectare and the BCR of sampled farmers was 2.20, this indicates that turmeric farms with a BCR greater than 1 have greater benefits than costs as well as positive net benefits. Seed (rhizome) and fertilizer showed significant positive effects on the turmeric production in the stochastic frontier production model. Turmeric farming displayed a mean technical efficiency of 82%, which suggested a substantial 18% of potential output of turmeric can be recovered by removing inefficiency. Besides improving technical efficiency, potential also exists for raising turmeric production through higher education and extension services. For a land scarce country like Bangladesh this gain could help increase income and ensure better livelihood for the hilly farmers. The policy implication of the analysis is that investment in education and extension service would greatly improve technical efficiency that contribute to income of the hilly people. Bangladesh J. Agril. Res. 44(1): 43-58, March 2019

scholarly journals An Estimation of Technical Efficiency of Poultry Farming in Nepal

2019 ◽  
pp. 88-111
Author(s):  
Nripesh Bahadur Pradhan ◽  
Nirmal Kumar Raut
Keyword(s):  
Technical Efficiency ◽  
Error Term ◽  
High Efficiency ◽  
Stochastic Frontier ◽  
Production Model ◽  
Likelihood Estimator ◽  
Homogenous Distribution ◽  
Efficient Level ◽  
Commercial Poultry ◽  
Poultry Farming

 The commercial poultry is growing rapidly in Nepal which requires that efficient level of output that ensures high levels of productivity and profit is produced. The objective of this study is to estimate the technical efficiency of the poultry farming in Nepal and its distribution spatially across the districts. The study utilizes Cobb-Douglas production function to define the structure of the production model and its error term is assumed to follow exponential distribution. Thereafter, using maximum likelihood estimator, parametric approach to Stochastic Frontier Method is applied to the data obtained from Nepal Commercial Poultry Survey 2015. The study finds technical efficiency of 92 percent suggesting high efficiency. Assuming half-normal distribution in the error term, however, yields technical efficiency of 89 percent. Further disaggregation of technical efficiency by districts shows its homogenous distribution across the districts covered in the study. The study, hence, suggests the possibility to increase its production to the level of potential output by improving technical efficiency. One of the various ways to improve technical efficiency is by ensuring high quality inputs both physical and technical to the poultry farms.

scholarly journals Eficiencia técnica de pesquerías con heterogeneidad inobservada

2019 ◽  
Vol 37 (3) ◽  
pp. 101
Author(s):  
David Castilla Espino ◽  
Juan José García del Hoyo
Keyword(s):  
Technical Efficiency ◽  
Latent Class ◽  
Stochastic Frontier Analysis ◽  
Unobserved Heterogeneity ◽  
Stochastic Frontier ◽  
Production Model ◽  
Stochastic Frontier Model ◽  
Production Frontier ◽  
Frontier Analysis ◽  
Production Activity

Fisheries production is subject to a significant variability caused no only by the stochastic nature of fisheries due to uncontrolled environmental and biological conditions, but also by factors related to production activity. It is necessary to take into consideration all these factors to avoid biases on production model estimates. This paper aims to go through this variability in Stochastic Frontier Analysis to account for observed and unobserved heterogeneity together with technical efficiency and randomness. This paper exemplifies the application of a Latent Class Stochastic Frontier model to the anchovy fishery of Southeastern Black Sea to account for production frontier heterogeneity. Results show a mean level of technical efficiency of 55%, which is higher than those produced by the standard stochastic frontier model. Moreover, results allow identifying two latent classes in the fleet. They also provide sound scientific advice for de management of the fishery.

Economic analysis of cassava production in Ogbia Local Government Area, Bayelsa State

2021 ◽  
Vol 1 (2) ◽  
pp. 001-008
Author(s):  
NC Morgan ◽  
DA Wasini ◽  
IE Larry
Keyword(s):  
Local Government ◽  
Technical Efficiency ◽  
Stochastic Frontier ◽  
Local Government Area ◽  
Production Model ◽  
Farm Size ◽  
Cost Ratio ◽  
Gross Margin ◽  
Benefit Cost Ratio ◽  
Cassava Production

The study was carried out to analyze “the Economics of cassava production in Ogbia Local Government Area of Bayelsa State, Nigeria”. The specific objectives of the study were to describe the socio-economic characteristics of cassava farmers; analyze costs and returns of producing cassava; determine technical efficiency; determine factors influencing technical efficiency of cassava farmers; and Identify constraints associated with cassava production in the study area. The sample of (94) cassava farmers was drawn from (10) communities in Ogbia and structured questionnaires were administered. Descriptive statistics, Translog Stochastic Frontier Production Model (SFPM) and budgetary model were used to analyze the data. Female (87.23%) dominated cassava production. 74% falls within the age of 21-50 years. Majority were married (65%) and 54.26% had a family size of 6-10. 52.13% of the respondents were basically farmers and all of them get there source of income for farming from personal savings and 72.34% used both family and hired labour in the production of cassava with 58.51% of them having farm size ≤0.5. The study further reveals that the gross margin was ₦521,313.50 and the profitability index was 64.07, while the rate of return on investment was 178.31, benefit-cost ratio of 2.8 proving the viability of cassava production in the study area. Lack of credit facilities, high spread of disease, lack of land were the major constraints faced by the farmers. Loans and grants should be made available to farmers either by government agencies or rather programs to fund cassava production should be created.

scholarly journals Technical Efficiency of Plantain Production in Ekiti Southwest Local Government Area of Ekiti State, Nigeria

2018 ◽  
Vol 8 ◽  
pp. 1203-1213
Author(s):  
Rufus Sunday Owoeye ◽  
F. O. Osundare
Keyword(s):  
Local Government ◽  
Technical Efficiency ◽  
Descriptive Analysis ◽  
Stochastic Frontier ◽  
Local Government Area ◽  
Production Model ◽  
Farm Size ◽  
Small Scale ◽  
Access To Credit ◽  
Pests And Diseases

This study examined the technical efficiency of plantain production in Ekiti Southwest Local Government Area (LGA) of Ekiti State, Nigeria. The study used multistage sampling techniques for data collection. Data were collected from 90 plantain farmers through well-structured questionnaires from the LGA with three towns purposively selected. The collected data were analyzed using descriptive statistics, budgetary analysis and stochastic frontier production model. Results from descriptive analysis showed that 48.88 percent of the plantain farmers had secondary education and above. Majority of the respondents (66.67 percent) had between 5 and 8 members that made up the household in the study area. Findings further showed that majority of the respondents produced on small scale with average plantain farm size of 0.96 hectares. The farmers were fairly experienced with 44.44 percent of them had more than 15 years of farming experience. With mean profit of ₦251,500 per hectare and percentage profit of 63.11 percent, the venture was considered to be highly profitable. Farmers who invested ₦1 realized revenue of ₦0.63. The RTS parameter (0.931) was obtained from the summation of the coefficients of the estimated inputs (elasticities) which indicated that plantain production in the study area was in Stage II of the production surface meaning that these variables were efficiently utilized. Depreciation, hired labour, family labour, farm size and quantity of suckers planted were the significant variables that influence efficiency of the plantain farmers. Age, land acquisition and access to credit contributed significantly to technical inefficiency. Among the most prevalent constraints were; price fluctuation (72.22%), heavy wind (70.00%), high cost of farm input (68.89%), pests and diseases and pilferage (63.33%) each, insufficient credit facility, storage facility and poor agricultural extension services (62.22%) respectively.

scholarly journals Technical efficiency of hybrid maize production in eastern terai of Nepal: A stochastic frontier approach

2018 ◽  
Vol 1 (1) ◽  
pp. 189-196 ◽  
Author(s):  
Surya P. Adhikari ◽  
Krishna P. Timsina ◽  
Peter R. Brown ◽  
Yuga N. Ghimire ◽  
Jeevan Lamichhane
Keyword(s):  
Technical Efficiency ◽  
Stochastic Frontier ◽  
Production Model ◽  
Farm Size ◽  
Efficient Production ◽  
Stochastic Frontier Approach ◽  
Maize Production ◽  
Socioeconomic Variable ◽  
Older Farmers ◽  
Hybrid Maize

Maize is the second most important crop after rice in terms of area and production in Nepal. This article analyzes the technical efficiency and its determinants of hybrid maize production in eastern Nepal. Using a randomly selected data from 98 farmers (41 from Morang and 57 from Sunsari) in eastern Nepal, the study employed a stochastic frontier production model to find the production elasticity coefficients of inputs, determinants of efficiency and technical efficiency of hybrid maize farmers. The results showed that maize production responds positively to increase in amount of urea, DAP and the area planted, where as it is negative to seed quantity. The study indicate that farmers are not technically efficient with a mean technical efficiency 79 %. Socioeconomic variable age had a negative and significant while the household size had a positive and significant related to maize output. The younger farmers were observed more technically efficient than older farmers. Larger the members in the household higher the maize production. It is recommended that farmers should increase their fertilizer dose and farm size while they should decrease their seed rate for efficient production.

scholarly journals Factors Associated with the Technical Efficiency of Maize Seed Production in the Mid-Hills of Nepal: Empirical Analysis

2021 ◽  
Vol 2021 ◽  
pp. 1-8
Author(s):  
Mahesh Sapkota ◽  
Niraj Prakash Joshi
Keyword(s):  
Technical Efficiency ◽  
Seed Production ◽  
Stochastic Frontier ◽  
Seed Source ◽  
Production Model ◽  
Maize Seed ◽  
Extension Services ◽  
Short Supply ◽  
Factors Affecting ◽  
Household Heads

Maize is the second most important staple crop in Nepal. Its demand is rapidly increasing due to a growth in the poultry sector. The national maize yield is low, leading to insufficient domestic production and thereby increasing imports. Maize seed is considered as one of the crucial inputs in achieving the targeted yield growth, but usually is in short supply during the cropping season. Farmers are involved in maize seed production, which eases its supply. Thus, understanding the efficiency of maize seed production will have a direct impact on the efficiency of the country’s maize production. This paper aimed to assess the technical efficiency (TE) of maize seed production and the major factors affecting TE. Semistructured questionnaire survey was administered in June 2016 to 182 maize seed farmers selected randomly from a total of 260 maize seed growers in Palpa District, a leading maize seed producing district in the mid-hills of Nepal. TE is estimated based on the stochastic frontier production model, and the factors affecting TE are assessed using the Tobit model. TE ranged from 0.25 to 0.92 with an average of 0.71. This revealed the scope of increasing TE by 29%. TE in the study area is largely affected by the age and schooling year of household heads. Similarly, the experience of maize seed production, livestock holding, the share of maize seed area, seed source, and access to extension services affect TE. Hence, a focus on motivating experienced educated maize seed growers to expand the maize seed production area supplemented by a better seed source and extension services would contribute to improving TE.

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