Farms' technical inefficiencies in the presence of government programs

We focus on determining the impacts of government programs on farms’ technical inefficiency levels. We use Kumbhakar’s stochastic frontier model that accounts for both production risks and risk preferences. Our theoretical framework shows that decoupled government transfers are likely to increase (decrease) DARA (IARA) farmers’ production inefficiencies if variable inputs are risk decreasing. However, the impacts of decoupled payments cannot be anticipated if variable inputs are risk increasing. We use farm-level data collected in Kansas to illustrate the model.


Issue Date:
2008
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/117736
Published in:
Australian Journal of Agricultural and Resource Economics, Volume 52, Issue 1
Page range:
57-76
Total Pages:
20




 Record created 2017-04-01, last modified 2017-08-26

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)