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Abstract
The aim of this paper is to investigate the relative contribution of technical
efficiency, technological change and increased input use to the output growth of the
Tunisian olive oil growing farms using a stochastic frontier production function
approach applied to panel data for the period 1995- 1997. The proposed methodology is
based on the use of a flexible translog functional form. Results indicate that technical
efficiency of production in the sample of olive producing farms investigated ranges from
a minimum of 24.8% to a maximum of 84.6% with an average technical efficiency
estimate of 48.5%. This suggests that olive producers may increase their production by
as much as 51.5% through more efficient use of production inputs. Further, the
production is characterised by decreasing returns to scale, which on average was 0.8.
Finally, investigation of the sources of production growth reveals that the contribution
of conventional inputs (labour, in particular) and technical change are found to be the
main source of that growth, since total factor productivity increased during the study
period, but at a slowing rate.