A cross-country comparison of pig production systems performance: Evidence from EU countries





Stochastic frontier analysis, transient and persistent technical efficiency, determinants of efficiency, pork farms


This study estimates and analyze the technical efficiency of pork farms from five EU countries. The Generalized True Random-effects (GTRE) model was used to differentiate between persistent and transitory technical efficiency. The results show that elasticities are robust to various specifications. Spanish farms show the highest average efficiency score. In Denmark, Germany, France, and Poland, the most significant opportunities for growth are found in transitional efficiency. The degree of productive specialization in the five countries has a positive impact in the efficiency. In Denmark, Germany, and France, persistent efficiency has a positive association with the fraction of paid labor.


Download data is not yet available.

Author Biographies

Ricardo Troncoso, Universidad Católica del Norte

Departamento de Administración

Juan Cabas, University of Bío-Bío

Departamento de Gestión Empresarial

Bouali Guesmi, Universitat Politècnica de Catalunya

Centro de Investigación y Desarrollo Agroalimentario, CREDA-UPC-IRTA

José María Gil, Universitat Politècnica de Catalunya

Centro de Investigación y Desarrollo Agroalimentario, CREDA-UPC-IRTA


Addo, F. & Salhofer, K. (2022). "Transient and persistent technical efficiency and its determinants: the case of crop farms in Austria". Applied Economics, 54(25), 2916-2932. https://doi.org/10.1080/00036846.2021.2000580

Agasisti, T. & Gralka, S. (2019). "The transient and persistent efficiency of Italian and German universities: a stochastic frontier analysis". Applied Economics, 51(46), 5012-5030. https://doi.org/10.1080/00036846.2019.1606409

Andrews, D.W. (2001). "Testing when a parameter is on the boundary of the maintained hypothesis". Econometrica, 69(3), 683-734. https://doi.org/10.1111/1468-0262.00210

Badunenko, O. & Kumbhakar, S.C. (2016). "When, where and how to estimate persistent and transient efficiency in stochastic frontier panel data models". European Journal of Operational Research, 255(1), 272-287. https://doi.org/10.1016/j.ejor.2016.04.049

Badunenko, O. & Kumbhakar, S.C. (2017). "Economies of scale, technical change and persistent and time-varying cost efficiency in Indian banking: do ownership, regulation and heterogeneity matter?" European Journal of Operational Research, 260(2), 789-803. https://doi.org/10.1016/j.ejor.2017.01.025

Baležentis, T. & De Witte, K. (2015). "One-and multi-directional conditional efficiency measurement-efficiency in Lithuanian family farms". European Journal of Operational Research, 245(2), 612-622. https://doi.org/10.1016/j.ejor.2015.01.050

Baležentis, T. & Sun, K. (2020). "Measurement of technical inefficiency and total factor productivity growth: a semiparametric stochastic input distance frontier approach and the case of Lithuanian dairy farms". European Journal of Operational Research, 285(3), 1174-1188. https://doi.org/10.1016/j.ejor.2020.02.032

Battese, G.E. & Coelli, T.J. (1992). "Frontier production functions, technical efficiency and panel data: with application to paddy farmers in India". Journal of productivity analysis, 3(1), 153-169. https://doi.org/10.1007/BF00158774

Berisso, O. (2019). "Analysis of factors affecting persistent and transient inefficiency of Ethiopia's smallholder cereal farming". In Nilson, P. & Heshmati, A. (Eds.): Efficiency, equity and well-being in selected African countries (pp.199-228). Cham, Switzerland: Springer Nature Switzerland AG. https://doi.org/10.1007/978-3-030-11419-0_10

Calafat-Marzal, M.C., Martí-Selva, M.L. & Puertas-Medina, R.M. (2018). "Eficiencia del sector ganadero valenciano: aproximación no paramétrica". Información Técnica Económica Agraria (ITEA), 114(1), 61-77. https://doi.org/10.12706/itea.2018.005

Chavas, J.P., Shi, G. & Meng, X. (2022). "Land rental market and rural household efficiency in China". Environment and Development Economics, 27(2), 103-119. https://doi.org/10.1017/S1355770X20000583

Colombi, R., Kumbhakar, S.C., Martini, G. & Vittadini, G. (2014). "Closed skew normality in stochastic frontiers with individual effects and long/short run efficiency". Journal of Productivity Analysis, 42(2), 123-136. https://doi.org/10.1007/s11123-014-0386-y

Colombi, R., Martini, G. & Vittadini, G. (2017). "Determinants of transient and persistent hospital efficiency: the case of Italy". Health economics, 26(S2), 5-22. https://doi.org/10.1002/hec.3557

European Commission (2022). Farm Accountancy Data Network (FADN). Retrieved from: European Commission: https://agriculture.ec.europa.eu/data-and-analysis/farm-structures-and-economics/fadn_en

Featherstone, A.M., Langemeier, M.R. & Ismet, M. (1997). "A nonparametric analysis of efficiency for a sample of Kansas beef cow farms". Journal of Agricultural and Applied Economics, 29(1), 175-184. https://doi.org/10.1017/S1074070800007653

Filippini, M. & Greene, W. (2016). "Persistent and transient productive inefficiency: a maximum simulated likelihood approach". Journal of Productivity Analysis, 45(2), 187-196. https://doi.org/10.1007/s11123-015-0446-y

Gavian, S. & Ehui, S. (1999). "Measuring the production efficiency of alternative land tenure contracts in a mixed crop-livestock system in Ethiopia". Agricultural Economics, 20(1), 37-49. https://doi.org/10.1016/S0169-5150(98)00067-X

Giannakas, K., Schoney, R. & Tzouvelekas, V. (2001). "Technical efficiency, technological change and output growth of wheat farms in Saskatchewan". Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, 49(2), 135-152. https://doi.org/10.1111/j.1744-7976.2001.tb00295.x

Greene, W. (2005a). "Fixed and random effects in stochastic frontier models". Journal of productivity analysis, 23(1), 7-32. https://doi.org/10.1007/s11123-004-8545-1

Greene, W. (2005b). "Reconsidering heterogeneity in panel data estimators of the stochastic frontier model". Journal of econometrics, 126(2), 269-303. https://doi.org/10.1016/j.jeconom.2004.05.003

Gutierrez, R.G., Carter, S. & Drukker, D.M. (2001). "On boundary-value likelihood ratio tests". Stata Technical Bulletin, 10(60), 15-18.

Henningsen, A., Czekaj, T.G., Forkman, B., Lund, M. & Nielsen, A.S. (2018). "The relationship between animal welfare and economic performance at farm level: a quantitative study of Danish pig producers". Journal of agricultural economics, 69(1), 142-162. https://doi.org/10.1111/1477-9552.12228

Johnes, G. & Johnes, J. (2009). "Higher education institutions' costs and efficiency: taking the decomposition a further step". Economics of Education Review, 28(1), 107-113. https://doi.org/10.1016/j.econedurev.2008.02.001

Jondrow, J., Lovell, C.K., Materov, I.S. & Schmidt, P. (1982). "On the estimation of technical inefficiency in the stochastic frontier production function model". Journal of econometrics, 19(23), 233-238. https://doi.org/10.1016/0304-4076(82)90004-5

Karagiannis, G. & Sarris, A. (2005). "Measuring and explaining scale efficiency with the parametric approach: the case of Greek tobacco growers". Agricultural Economics, 33(s3), 441-451. https://doi.org/10.1111/j.1574-0864.2005.00084.x

Kourtesi, S., De Witte, K. & Polymeros, A. (2016). "Technical efficiency in the agricultural sector-evidence from a conditional quantile-based approach". Agricultural Economics Review, 17(2), 100-123. http://dx.doi.org/10.22004/ag.econ.262443

Kumbhakar, S.C. (1990). "Production frontiers, panel data, and time-varying technical inefficiency". Journal of econometrics, 46(1-2), 201-211. https://doi.org/10.1016/0304-4076(90)90055-X

Kumbhakar, S.C. & Heshmati, A. (1995). "Efficiency measurement in Swedish dairy farms: an application of rotating panel data, 1976-88". American Journal of Agricultural Economics, 77(3), 660-674. https://doi.org/10.2307/1243233

Kumbhakar, S.C., Lien, G. & Hardaker, J.B. (2014). "Technical efficiency in competing panel data models: a study of Norwegian grain farming". Journal of Productivity Analysis, 41(2), 321-337. https://doi.org/10.1007/s11123-012-0303-1

Labajova, K., Hansson, H., Asmild, M., Göransson, L., Lagerkvist, C.-J. & Neil, M. (2016). "Multidirectional analysis of technical efficiency for pig production systems: the case of Sweden". Livestock Science, 187, 168-180. https://doi.org/10.1016/j.livsci.2016.03.009

Lai, H.-p. & Kumbhakar, S.C. (2018). "Panel data stochastic frontier model with determinants of persistent and transient inefficiency". European Journal of Operational Research, 271(2), 746-755. https://doi.org/10.1016/j.ejor.2018.04.043

Lai, H.-p. & Kumbhakar, S.C. (2019). "Technical and allocative efficiency in a panel stochastic production frontier system model". European Journal of Operational Research, 278(1), 255-265. https://doi.org/10.1016/j.ejor.2019.04.001

Larue, S., Abildtrup, J. & Schmitt, B. (2007). "Modeling the spatial structure of pig production in Denmark". Conference paper presented in 54th Annual North American meetings of the Regional Science Association International, Savannah, USA.

Latruffe, L., Davidova, S. & Balcombe, K. (2008). "Application of a double bootstrap to investigation of determinants of technical efficiency of farms in central Europe". Journal of productivity analysis, 29(2), 183-191. https://doi.org/10.1007/s11123-007-0074-2

Laureti, T. (2008). "Modelling exogenous variables in human capital formation through a heteroscedastic stochastic frontier". International Advances in Economic Research, 14, 76-89. https://doi.org/10.1007/s11294-007-9132-9

Lien, G., Kumbhakar, S.C. & Alem, H. (2018). "Endogeneity, heterogeneity, and determinants of inefficiency in Norwegian crop-producing farms". International Journal of Production Economics, 201, 53-61. https://doi.org/10.1016/j.ijpe.2018.04.023

MAPA (2020). El sector de la carne de cerdo en cifras: Principales indicadores económicos. Madrid, Spain: Subdirección General de Producciones Ganaderas y Cinegéticas, Dirección General de Producciones y Mercados Agrarios. Ministerio de Agricultura Pesca y Alimentación.

Minviel, J.J. & Sipiläinen, T. (2021). "A dynamic stochastic frontier approach with persistent and transient inefficiency and unobserved heterogeneity". Agricultural Economics, 52(4), 575-589. https://doi.org/10.1111/agec.12636

Musau, A., Kumbhakar, S.C., Mydland, Ø. & Lien, G. (2021). "Determinants of allocative and technical inefficiency in stochastic frontier models: an analysis of Norwegian electricity distribution firms". European Journal of Operational Research, 288(3), 983-991. https://doi.org/10.1016/j.ejor.2020.06.023

Pitt, M.M. & Lee, L.-F. (1981). "The measurement and sources of technical inefficiency in the Indonesian weaving industry". Journal of development economics, 9(1), 43-64. https://doi.org/10.1016/0304-3878(81)90004-3

Robinson, P.M. (1988). "Root-n-consistent semiparametric regression". Econometrica: Journal of the Econometric Society, 56(4), 931-954. https://doi.org/10.2307/1912705

Roguet, C., Gaigné, C., Chatellier, V., Cariou, S., Carlier, M., Chenut, R., Daniel, K. & Perrot, C. (2015). "Spécialisation territoriale et concentration des productions animales européennes: état des lieux et facteurs explicatifs". INRAE Productions Animales, 28(1), 5-22. https://doi.org/10.20870/productions animales.2015.28.1.3007

Schmidt, P. & Sickles, R.C. (1984). "Production frontiers and panel data". Journal of Business & Economic Statistics, 2(4), 367-374. https://doi.org/10.1080/07350015.1984.10509410

Sun, H., Edziah, B.K., Song, X., Kporsu, A.K. & Taghizadeh-Hesary, F. (2020). "Estimating persistent and transient energy efficiency in belt and road countries: a stochastic frontier analysis". Energies, 13(15), 3837. https://doi.org/10.3390/en13153837

Trnkova, G. & Kroupova, Z.Z. (2020). "Determinants of persistent and transient technical efficiency of milk production in EU". E+M Ekonomie a Management, 23(4), 39-55. https://doi.org/10.15240/tul/001/2020-4-003

Tsionas, E.G. & Kumbhakar, S.C. (2014). "Firm heterogeneity, persistent and transient technical inefficiency: a generalized true random-effects model". Journal of Applied Econometrics, 29(1), 110-132. https://doi.org/10.1002/jae.2300

Xu, T., Sun, F.-F. & Zhou, Y.-H. (2015). "Technical efficiency and its determinants in China's hog production". Journal of Integrative Agriculture, 14(6), 1057-1068. https://doi.org/10.1016/S2095-3119(14)60989-8

Zhu, X. & Lansink, A.O. (2010). "Impact of cap subsidies on technical efficiency of crop farms in Germany, the Netherlands and Sweden". Journal of Agricultural Economics, 61(3), 545-564. https://doi.org/10.1111/j.1477-9552.2010.00254.X