Productivity and subsidies in the European Union: an analysis for dairy farms using Input distance frontiers

Latruffe , Laure
        INRA
        , Rennes .
         UMR 1302 Structures et Marchés Agricoles, Ressources et Territoires; Bravo-Ureta , Boris
        University of Talca, Talca.; Moreira , Victor Hugo
        .; Desjeux , Yann
        INRA
        , Rennes .
         UMR 1302 Structures et Marchés Agricoles, Ressources et Territoires; Dupraz , Pierre
        INRA
        , Rennes .
         UMR 1302 Structures et Marchés Agricoles, Ressources et Territoires

Productivity and subsidies in the European Union: an analysis for dairy farms using Input distance frontiers

2012

Latruffe , Laure (INRA , Rennes (France). UMR 1302 Structures et Marchés Agricoles, Ressources et Territoires) | Bravo-Ureta , Boris (University of Connecticut, Department of Agricultural and Resource Economics, Storrs, (USA)University of Talca, Talca(Chili).) | Moreira , Victor Hugo (Universidad Austral de Chile, Valdivia(Chili).) | Desjeux , Yann (INRA , Rennes (France). UMR 1302 Structures et Marchés Agricoles, Ressources et Territoires) | Dupraz , Pierre (INRA , Rennes (France). UMR 1302 Structures et Marchés Agricoles, Ressources et Territoires)

This paper examines the association between agricultural subsidies and farm efficiency using data from the European Farm Accountancy Data Network (FADN) for operations specializing on dairy. The analysis covers the 18 year period going from 1990 to 2007 and includes eleven countries: Belgium, Denmark, France, Germany, Ireland, Italy, Luxemburg, the Netherlands, Portugal, Spain, and the United Kingdom. Separate translog stochastic input distance frontiers are estimated for each country. Results show high technical efficiency averages and positive average rates of technological change. In addition, higher subsidy dependence and larger size are significantly associated with lower technical efficiency across all eleven countries.

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