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Provision of environmental output within a multi-output distance function approach

Areal, F., Tiffin, R. and Balcombe, K. (2012) Provision of environmental output within a multi-output distance function approach. Ecological Economics, 78. pp. 47-54. ISSN 0921-8009

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To link to this article DOI: 10.1016/j.ecolecon.2012.03.011

Abstract/Summary

This paper redefines technical efficiency by incorporating provision of environmental goods as one of the outputs of the farm. The proportion of permanent and rough grassland to total agricultural land area is used as a proxy for the provision of environmental goods. Stochastic frontier analysis was conducted using a Bayesian procedure. The methodology is applied to panel data on 215 dairy farms in England and Wales. Results show that farm efficiency rankings change when provision of environmental outputs by farms is incorporated in the efficiency analysis, which may have important political implications.

Item Type:Article
Refereed:Yes
Divisions:Faculty of Life Sciences > School of Agriculture, Policy and Development > Economic and Social Sciences Division > Farm Management Unit
Faculty of Life Sciences > School of Agriculture, Policy and Development > Economic and Social Sciences Division > Food Economics and Marketing (FEM)
ID Code:25516
Uncontrolled Keywords:Stochastic frontier; Environmental output; Technical efficiency
Publisher:Elsevier

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