Factors Influencing Technical Efficiency in the EU Dairy Farms

This paper aims to analyse the technical efficiency (TE) of dairy farms and find its determinants. To accomplish this problem, the Stochastic Frontier Analysis was applied. The data were obtained from the Farm Accountancy Data Network database for dairy farms (TF15-45—Specialist dairying) for 2004–2...

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Autores principales:	Zdeňka Náglová, Tamara Rudinskaya
Formato:	article
Lenguaje:	EN
Publicado:	MDPI AG 2021
Materias:	subsidies farm size milk cluster analysis stochastic frontier analysis European Union Agriculture (General) S1-972
Acceso en línea:	https://doaj.org/article/d500840c6fc841abab93add1b96918cb
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spelling	oai:doaj.org-article:d500840c6fc841abab93add1b96918cb2021-11-25T15:59:24ZFactors Influencing Technical Efficiency in the EU Dairy Farms10.3390/agriculture111111142077-0472https://doaj.org/article/d500840c6fc841abab93add1b96918cb2021-11-01T00:00:00Zhttps://www.mdpi.com/2077-0472/11/11/1114https://doaj.org/toc/2077-0472This paper aims to analyse the technical efficiency (TE) of dairy farms and find its determinants. To accomplish this problem, the Stochastic Frontier Analysis was applied. The data were obtained from the Farm Accountancy Data Network database for dairy farms (TF15-45—Specialist dairying) for 2004–2019. Dairy farms were divided into four clusters according to their physical size (number of livestock units per farm) and economic size (standard output per farm). The largest farms by physical and economic size are located in Denmark and Cyprus. The smallest, in comparison, are in Bulgaria, Croatia, Latvia, Lithuania, Austria, Poland, Romania, and Slovenia. Farms in the EU are relatively technically efficient, i.e., they use their resources efficiently to produce maximum output (production). However, they have the potential to achieve better economic results and be more competitive, as the size of farms’ is not fully optimised. The abolition of the milk quota can be considered a factor in improving technical efficiency, as the indicator is higher after the abolition. New and old member states have almost comparable technical efficiency levels (the <i>p</i>-value of the <i>t</i>-test is 0.463), with old members having slightly higher level TE. Subsidies have contradictory effects on TE. Farm efficiency with higher subsidies per cow is higher for farms with €51–100/cow. However, as subsidies increase, TE decreases. Only the group of farms with the highest subsidies has a higher TE. More diversified farms are more technically efficient than specialised farms. Milk yield did not influence the analysed indicator. The analysis results can serve the stakeholders as a tool for modelling future agricultural policy, as the European farms are very heterogenous and show different conditions and economic outcomes.Zdeňka NáglováTamara RudinskayaMDPI AGarticlesubsidiesfarm sizemilkcluster analysisstochastic frontier analysisEuropean UnionAgriculture (General)S1-972ENAgriculture, Vol 11, Iss 1114, p 1114 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	subsidies farm size milk cluster analysis stochastic frontier analysis European Union Agriculture (General) S1-972
spellingShingle	subsidies farm size milk cluster analysis stochastic frontier analysis European Union Agriculture (General) S1-972 Zdeňka Náglová Tamara Rudinskaya Factors Influencing Technical Efficiency in the EU Dairy Farms
description	This paper aims to analyse the technical efficiency (TE) of dairy farms and find its determinants. To accomplish this problem, the Stochastic Frontier Analysis was applied. The data were obtained from the Farm Accountancy Data Network database for dairy farms (TF15-45—Specialist dairying) for 2004–2019. Dairy farms were divided into four clusters according to their physical size (number of livestock units per farm) and economic size (standard output per farm). The largest farms by physical and economic size are located in Denmark and Cyprus. The smallest, in comparison, are in Bulgaria, Croatia, Latvia, Lithuania, Austria, Poland, Romania, and Slovenia. Farms in the EU are relatively technically efficient, i.e., they use their resources efficiently to produce maximum output (production). However, they have the potential to achieve better economic results and be more competitive, as the size of farms’ is not fully optimised. The abolition of the milk quota can be considered a factor in improving technical efficiency, as the indicator is higher after the abolition. New and old member states have almost comparable technical efficiency levels (the <i>p</i>-value of the <i>t</i>-test is 0.463), with old members having slightly higher level TE. Subsidies have contradictory effects on TE. Farm efficiency with higher subsidies per cow is higher for farms with €51–100/cow. However, as subsidies increase, TE decreases. Only the group of farms with the highest subsidies has a higher TE. More diversified farms are more technically efficient than specialised farms. Milk yield did not influence the analysed indicator. The analysis results can serve the stakeholders as a tool for modelling future agricultural policy, as the European farms are very heterogenous and show different conditions and economic outcomes.
format	article
author	Zdeňka Náglová Tamara Rudinskaya
author_facet	Zdeňka Náglová Tamara Rudinskaya
author_sort	Zdeňka Náglová
title	Factors Influencing Technical Efficiency in the EU Dairy Farms
title_short	Factors Influencing Technical Efficiency in the EU Dairy Farms
title_full	Factors Influencing Technical Efficiency in the EU Dairy Farms
title_fullStr	Factors Influencing Technical Efficiency in the EU Dairy Farms
title_full_unstemmed	Factors Influencing Technical Efficiency in the EU Dairy Farms
title_sort	factors influencing technical efficiency in the eu dairy farms
publisher	MDPI AG
publishDate	2021
url	https://doaj.org/article/d500840c6fc841abab93add1b96918cb
work_keys_str_mv	AT zdenkanaglova factorsinfluencingtechnicalefficiencyintheeudairyfarms AT tamararudinskaya factorsinfluencingtechnicalefficiencyintheeudairyfarms
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Factors Influencing Technical Efficiency in the EU Dairy Farms

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