Is Input Mix Inefficiency Neglected in Agriculture? A Case Study of Pig-based Farming Systems in England and Wales

Title
Is Input Mix Inefficiency Neglected in Agriculture? A Case Study of Pig-based Farming Systems in England and Wales
Publication Date
2013
Author(s)
Hadley, David
( author )
OrcID: https://orcid.org/0000-0001-8634-2586
Email: dhadley@une.edu.au
UNE Id une-id:dhadley
Fleming, Euan
Villano, Renato
( author )
OrcID: https://orcid.org/0000-0003-2581-6623
Email: rvillan2@une.edu.au
UNE Id une-id:rvillan2
Type of document
Journal Article
Language
en
Entity Type
Publication
Publisher
Wiley-Blackwell Publishing Ltd
Place of publication
United Kingdom
DOI
10.1111/1477-9552.12003
UNE publication id
une:12977
Abstract
The principal concern of this article is the relative importance of input mix as a source of inefficiency. Emphasis in efficiency analysis studies in agricultural production has historically focused on technical inefficiency as a single concept until methodological advances enabled it to be decomposed into pure technical inefficiency and scale inefficiency. But, this advance was insufficient to identify what we consider to be the major source of inefficiency in agricultural production, namely mix inefficiency. We consider that farm enterprises may be particularly susceptible to input mix inefficiency because of restrictions on movement around the frontier isoquant; delays in the adoption of improved technologies embodied in new vintages of production processes; risk as a source of friction in input allocation decisions; and the potential for inconsistency in simultaneously attempting to reach points of allocative efficiency and mix efficiency in input use. We use non-parametric methods to calculate a Hicks-Moorsteen productivity index using panel data for a sample of specialised pig producers in England and Wales. This index is then decomposed into measures of technology, technical efficiency, scale efficiency and mix efficiency for an input orientation. Results of the analysis show that the estimated mean mix inefficiency (0.736) was substantially larger than mean technical inefficiency (0.975) and mean scale inefficiency (0.957) over the study period.
Link
Citation
Journal of Agricultural Economics, 64(2), p. 505-515
ISSN
1477-9552
0021-857X
Start page
505
End page
515

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