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An analysis of production efficiency of cow-calf operations in Alberta

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Title: An analysis of production efficiency of cow-calf operations in Alberta
Author: Samarajeewa, Sudarma Ranjani
Department: Department of Agricultural Economics and Business
Advisor: Hailu, GetuBredahl, Maury M.
Abstract: The purpose of this study is to examine the production efficiency (i.e., technical, allocative and economic) of cow-calf farms in Alberta. Production efficiencies are measured using an econometrically estimated stochastic Cobb-Douglas production frontier and analytically derived stochastic cost frontier. The study uses repeated cross-section data of samples of 333 Alberta cow-calf farms from 1995 to 2002. The results reveal that mean technical, allocative and economic efficiencies for sample cow-calf farms are approximately 83, 78, and 67 percents, respectively. ' Ceteris paribus', such degrees of production efficiency suggest that Alberta cow-calf producers could increase output and/or save cost by reallocating resources with the existing technology. Improvement in allocative efficiency appears to be relatively more important than technical efficiency as a source of gains in production efficiency for the sample cow-calf farms. The results suggest that herd size and biological efficiency have positive effects on production efficiency; government supports and production efficiency are negatively related; and there is variation in production efficiency across farms in different locations.
Date: 2007
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