Journal Article

Econometric Estimation of Technical and Environmental Efficiency: An Application to Dutch Dairy Farms

Stijn Reinhard, C.A. Knox Lovell and Geert Thijssen

in American Journal of Agricultural Economics

Published on behalf of Agricultural and Applied Economics Association

Volume 81, issue 1, pages 44-60
Published in print February 1999 | ISSN: 0002-9092
Published online February 1999 | e-ISSN: 1467-8276 | DOI: http://dx.doi.org/10.2307/1244449
Econometric Estimation of Technical and Environmental Efficiency: An Application to Dutch Dairy Farms

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In this article we estimate the technical and environmental efficiency of a panel of Dutch dairy farms. Nitrogen surplus, arising from the application of excessive amounts of manure and chemical fertilizer, is treated as an environmentally detrimental input. A stochastic translog production frontier is specified to estimate the output-oriented technical efficiency. Environmental efficiency is estimated as the input-oriented technical efficiency of a single input, the nitrogen surplus of each farm. The mean output-oriented technical efficiency is rather high, 0.894, but the mean input-oriented environmental efficiency is only 0.441. Intensive dairy farms are both technically and environmentally more efficient than extensive farms.

Keywords: dairy farming; environmental efficiency; panel data; stochastic production frontier; Q120; Q160; Q200

Journal Article.  0 words. 

Subjects: Renewable Resources and Conservation ; Agricultural Economics

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