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Technical efficiency and metatechnology ratios for dairy farms in three southern cone countries: a stochastic meta-frontier model

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Abstract

This paper compares technical efficiency (TE) and metatechnology ratios (MTR) for dairy farms from Argentina, Chile and Uruguay using the meta-frontier (MF) approach. The estimated average MTRs for Argentina, Chile and Uruguay are 83.8, 79.6 and 91.4%, respectively, and these results are significantly different from each other. The TEs estimated with respect to the MF are 72.8, 65.8 and 73.4% for Argentina, Chile and Uruguay, respectively. The average TEs for Argentina and Uruguay are not significantly different from each other but are significantly higher than the value for Chile. The production frontiers for Argentina and Uruguay are relatively close to the MF, which suggests that these two countries might need to increase investments to promote local research to generate new technologies and/or search for technologies to adapt from more distant areas. By contrast, Chile could benefit from adaptive research, designed to make borrowed technology from Argentina and/or Uruguay applicable to local conditions, which could be a cost effective way to improve dairy farm performance.

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Notes

  1. The LR statistic is given by λ = 2 [ln{L(HA)}−ln{L(H0)}], where L(HA) and L(H0) are the values of the likelihood function under the alternative and null hypotheses. The value of λ has a Chi-square distribution with the number of degrees of freedom equal to the number of restrictions imposed.

  2. Independent t-tests and one-way ANOVA are used to compare different figures. The former is used to compare means between two groups whereas the latter is applied when comparing more than two groups (Field 2005).

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Acknowledgments

The authors are grateful for the data provided by Amilcar Arzubi and Ernesto Schilder, Argentina; Jorge Alvarez and Carlos Molina, Uruguay; and the Paillaco Farm Management Center, Chile. We are also thankful for the comments provided by the two referees and the editors. The research reported in this paper was partially supported by the Fund for Fostering Scientific and Technological Research (FONDEF) of the National Commission for Scientific and Technological Research (CONICYT), Republic of Chile, under the DO3i-1151 code, and the Research and Development Department (DID) of Universidad Austral de Chile.

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Authors and Affiliations

  1. Department of Agricultural Economics, Instituto de Economía Agraria, Facultad de Ciencias Agrarias, Universidad Austral de Chile, Independencia 641, PO Box 567, Valdivia, Chile

    Víctor H. Moreira

  2. Department of Agricultural and Resource Economics, University of Connecticut, Mansfield, Connecticut, USA

    Boris E. Bravo-Ureta

  3. University of Talca, Talca, Chile

    Boris E. Bravo-Ureta

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  1. Víctor H. Moreira
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  2. Boris E. Bravo-Ureta
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Correspondence to Víctor H. Moreira.

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Moreira, V.H., Bravo-Ureta, B.E. Technical efficiency and metatechnology ratios for dairy farms in three southern cone countries: a stochastic meta-frontier model. J Prod Anal 33, 33–45 (2010). https://doi.org/10.1007/s11123-009-0144-8

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