A Comparison of Economic Efficiency of Monoculture and Multiple Cropping Patterns: The Case of Cassava Farming in Ende, Indonesia

<span lang="EN-US">Nuabosi cassava is an alternative carbohydrate source for the community, which is expected to be a substitute for rice. This commodity has the potential to be developed, but is limited in resources, so it requires technological breakthroughs. This study aims at analyzing the level of technical, allocative and economic efficiency between the cassava cropping pattern and the factors that affect the efficiency. The research was conducted in Randotonda Village, from November 2019 to January 2020 and the samples consisted of 61 monoculture farmers and 46 multiple cropping farmers. Data analysis was performed using the Cobb-Douglass stochastic frontier production function. The allocative and economic efficiency was examined with the stochastic frontier cost function approach. The results of stochastic frontier estimation show that all variables have a positive effect on the production variable. The variables having a positive effect on the total cost include the price of cassava cuttings, the price of fertilizer, production and the dummy cropping pattern. The average level of economic efficiency of monoculture farmers is lower than that of multiple cropping farmers. Factors that affect economic efficiency are age, length of time to cultivate, frequency of obtaining information, dummy of farmer group membership and dummy of cropping patterns. In short, the level of technical, allocative and economic efficiency of monoculture farmers is lower than that of multiple cropping farmers. Farmers are expected to pay attention to the types of plants that are suitable in implementing the multiple cropping pattern</span><span lang="IN">.</span>

Assessing the market power of millers and wholesalers in the Bangladesh rice sector

PurposeBecause of the increasing differential between farm and retail prices, the study proposes to investigate the extent of market power in the rice value chain of Bangladesh using advanced econometric techniques.Design/methodology/approachUsing a Stochastic Frontier Estimation approach on cross-sectional data, the study examines the price spread along the rice value chain to determine whether millers and wholesalers exercise market power.FindingsEmpirical results reveal that, on average, rice millers and wholesalers charge 33 and 29% above the marginal cost, respectively. This study confirms the non-competitive behavior of the rice market with wholesalers and millers wielding substantial market powerResearch limitations/implicationsA limitation of the study is that it does not include the retailers who also play a major role in the Bangladesh rice value chain. This is left for future study.Originality/valueThis study combines primary and secondary data collected on the Bangladesh rice sector to examine the market power of two major players along the value chain, millers and wholesalers, using an advanced econometrics approach.

Operational efficiency effects of blockchain technology implementation in firms

Purpose The purpose of this study is to evaluate the effect of blockchain technology on firms’ operational efficiency in the context of China. Design/methodology/approach The authors use panel data for blockchain-based companies listed on stock exchanges in China (Shanghai, Shenzhen and Hong Kong) between 2014 and 2018. The operational efficiency of firms that deploy blockchain technology is evaluated using ordinary least squares and system generalized method of moments estimation. Findings Results suggest that companies’ current year performance exceeds the previous year performance because of blockchain deployment in firms’ operations. Firms with higher financial leverage and return on assets reap more benefits from blockchain. Larger and older firms benefit less from blockchain implementation. Stochastic frontier estimation suggests that, on average, firms attain a 57.76 per cent technical efficiency level, or, put differently, they operate 42.24 per cent below their maximum level of potential output. Originality/value Blockchain can benefit firms in terms of consensus, security and trust, spurring the evolution of a new form of organizational dynamics. This study explores the theory of transactional cost analysis under blockchain technology. In addition, this study hypothesizes and empirically demonstrates the significant impacts of blockchain technology on corporations’ operational efficiency, using audited, externally reported financial data. Industry professionals can reap benefits from this research by noticing the magnitude of changes in firms’ financial parameters attributable to blockchain adoption.

Efficiency in the Public University

Usual efficiency evaluation methods, such as Data Envelopment Analysis and Stochastic Frontier Estimation tend to calculate efficiency scores which are valid only at a given moment and for the units where in the sample. At most, Malmquist index determines efficiency scores for period t+1. Those drawbacks can be avoided by translating efficiency scores in terms of probabilities trough the Discriminant Analysis which enables also, to provide appropriate weightings activities of research laboratories, object of this study. In addition to Discriminant Analysis, Hierarchical Cluster Analysis is used to classify those activities into homogeneous groups, while Data Envelopment Analysis is employed to categorize laboratories in efficient and inefficient structures. This method is applied on a public university in east of Morocco. This study shows that indexed publications as well as the supported doctoral thesis or in state of supervision have the greatest impact on efficiency of the research laboratories.

Exploiting the Trade Potential from Integration: Analysing the Impact of Free Trade Agreements between ASEAN and India and China

In this article, we use the technique of stochastic frontier estimation for the structural gravity model to analyse Vietnam’s bilateral trade and evaluate its exploitation of trade efficiency before and after its free trade agreements (FTAs) with China and India entered into force. The results from Vietnam’s bilateral trade data between 2000 and 2015 show that the ASEAN–India Free Trade Agreement (AIFTA) has had a positive impact on Vietnam’s bilateral trade flows while we found a remarkably negative effect on Vietnam’s exports but not imports after the entry into force of the ASEAN-China Free Trade Agreement (ACFTA). In addition, Vietnam’s participation in the regional trade agreements (RTAs) and FTAs has significantly reduced the costs of trade over time, and these impacts on Vietnam’s imports are much higher than those on Vietnam's exports.

Isolating the value-relevant part of advertising spending

Purpose This paper aims to examine how much importance the financial market attaches to advertising spending’s short-term productivity vis-à-vis its investment component and the impact of important contextual factors (investor mix and analyst coverage) on this trade-off. Design/methodology/approach A stochastic frontier estimation (SFE) approach is used to help disentangle advertising spending. Using a panel internal instruments model and 10,017 firm-year observations from publicly listed US companies over a 13-year period, this study relates aggregated advertising spending and disentangled advertising spending, together with important contextual factors, to Tobin’s q. Findings The results do not indicate an effect of aggregated advertising spending on Tobin’s q. However, after advertising spending is disentangled, results show the component with an efficient immediate revenue response to have a positive effect on Tobin’s q, whereas the effect of the remaining investment component is negative. Contextual factors moderate investors’ valuation of the components. Research limitations/implications Findings are limited to US publicly listed firms, and are based on secondary, non-experimental data. The results imply that investors reward firms only for short-term advertising productivity, casting doubt on investors’ understanding of the long-term value of marketing. Practical implications The results confirm managers’ belief that not all money spent on advertising creates shareholder value. Managers should use the outlined SFE to benchmark their firms’ short-term advertising productivity against that of industry peer firms. Originality/value This study advances a new perspective, suggesting that advertising spending can be decomposed into two distinct parts by considering how financial market investors evaluate advertising spending. Important contextual effects on this evaluation from firms’ investor mix and analyst coverage are also shown for the first time. The findings help in reconciling conflicting prior results, and shed new light on how the financial market evaluates marketing expenditures.