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Abstract
Organic farms work under very heterogeneous natural-site and socio-economic
conditions. This heterogeneity is of clear relevance for economic efficiency and for
the decision of farms to convert to organic farming. In order to produce proper
results efficiency analysis must consider such heterogeneity and self-selection
aspects. This applies in particular to data envelopment analysis, since this technique
does not calculate error terms, but include heterogeneity into efficiency results. One
way to control for such effects is matching. Matching is based on the assumption that
under a given vector of observable variables, the outcome of one individual is
independent of the adoption of a specific treatment. In our paper we present how to
implement matching into efficiency analysis of organic farms. We give a brief
overview on literature applying this technique and we discuss which insights the
application of matching might contribute to the current discussion on organic
farming.