Measuring Productivity Change and Efficiency on Irish Farms.

摘要

This report investigates technical change and levels of technical efficiency on Irish farmsusing National Farm Survey (N.F.S.) data. It also examines whether levels of technicalefficiency are influenced by contact with the extension service.The study utilises a stochastic production frontier approach to measure productivity growthand the technical efficiency of a panel of Irish farms over the period 1984 to 1998. Thissample was used to calculate (a) technical change over time as measured by best practicefarms and (b) technical efficiency levels of all farms over this period. It, therefore, providesdisaggregated estimates of technical change by farming system as well as quantifying theaverage level of technical efficiency. The project also examines the factors associated withdifferences in technical efficiency between farms and the impact of extension service contacton farm-level technical efficiency.Mean technical change (i.e. changes in best practice) continued, albeit at a declining rate,throughout the period studied. Significant differences were revealed in the rate of technicalchange on farms of different types. For example technical change on dairy and crop farmsaveraged nearly 2 per cent per annum while technical regress occurred on beef and sheepfarms.In addition to examining technical change, farm efficiency relative to best practice withineach farming system was also measured. Results indicate that farms achieved, on average,approximately 65 per cent of the efficiency level of best practice farms. The average level offarm efficiency has been decreasing by 0.4 per cent per annum indicating that the gapbetween best practice farms and all farms has been increasing by this amount over time.Thirty one percent of the most efficient farms were dairy farms while 23 per cent were arablefarms. Approximately 52 per cent of the least efficient farms were cattle farms while a further31 per cent were sheep farms. Average efficiency over the period was 34.2 per cent in theleast efficient quintile of farms. This compared to almost 90 per cent for the most efficientquintile of farms.A positive relationship between age and efficiency was found up to the age of 49 years afterwhich the relationship between age and efficiency becomes negative. The farm debt to assetsratio was positively related to efficiency while farm size and location in the West of Irelandwas negatively related to efficiency.Farms in contact with the extension service were found to be on average 6.5 per cent moreefficient than farms without contact. Contact farms with a lower than average dependency ondirect payments were a further 6.6 per cent than contact farms with an average dependencyon direct payments. Contact farms with a higher than average dependence on direct paymentswere 1.9 per cent less efficient than the same group of contact farms. However, efficiency onthese farms with a high dependence on direct payments was still, on average, higher than onfarms with no extension contact.