Efficiency Measurement in Greek Dairy Farms: Stochastic Frontier Vs. Data Envelopment Analysis

International Journal of Economic Sciences and Applied Research, Vol. 1, No. 2, pp. 53-67, 2008

14 Pages Posted: 6 Dec 2009

See all articles by A.M. Theodoridis

A.M. Theodoridis

Aristotle University - School of Agriculture - Department of Agricultural Economics

A. Psychoudakis

Aristotle University of Thessaloniki

Date Written: December 1, 2008

Abstract

Parametric Stochastic Frontier Analysis (SFA) and non-parametric Data Envelopment Analysis (DEA) have become very popular in the analysis of productive efficiency. This paper undertakes a comparison of the SFA and the constant returns to scale (CRS) and variable returns to scale (VRS) output-oriented DEA models, based on a sample of 165 dairy farms in Greece. However, the aim of this paper is not only to compare estimates of technical efficiency obtained from two approaches, but also to produce efficiency data about the farms studied, which have implications for agricultural policy to improve dairy production. The results indicate that there is a potential for increasing production in the dairy farms through improved efficiency.

Keywords: Data Envelopment Analysis, Stochastic Frontier Analysis, Dairy Farms

JEL Classification: Q18, D24, Q12

Suggested Citation

Theodoridis, A.M. and Psychoudakis, A., Efficiency Measurement in Greek Dairy Farms: Stochastic Frontier Vs. Data Envelopment Analysis (December 1, 2008). International Journal of Economic Sciences and Applied Research, Vol. 1, No. 2, pp. 53-67, 2008, Available at SSRN: https://ssrn.com/abstract=1517144

A.M. Theodoridis (Contact Author)

Aristotle University - School of Agriculture - Department of Agricultural Economics

Thessaloniki
Greece

A. Psychoudakis

Aristotle University of Thessaloniki

Thessaloniki
Greece

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