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- Heshmati, Almas
(author)
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Estimating random effects production function models with selectivity bias : an application to Swedish crop producers
- 1994
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In: Agricultural Economics. - 0169-5150 .- 1574-0862. ; 11:2-3, s. 171-189
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Journal article (peer-reviewed)abstract
- In this paper, the estimation of production functions and measurement of the rate of technical change is performed when selectivity bias is expected. A sample selection model consisting of a selection and a regression equation is estimated using Heckman’s two-stage method. It is discussed in the context of a production function where the underlying technology is represented by a translog functional form. For the regression, a random effects model with heteroscedastic variances is assumed. This model and an alternative conventional model retaining heteroscedasticity without considering selectivity bias are estimated using the Generalized Least Squares method. The data used are a large rotating panel data set from Swedish crop producers over the period 1976-1988. The empirical results from the comparison between these two models show that the introduction of heteroscedasticity and the integration of sample selection in the production relationship is important. The impact of a correction for selectivity bias on the results, in terms of input elasticities and returns to scale is found to be significant.
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- Heshmati, Almas, et al.
(author)
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Farm heterogeneity and technical efficiency : Some results from Swedish dairy farms
- 1994
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In: Journal of Productivity Analysis. - 0895-562X .- 1573-0441. ; 5:1, s. 45-61
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Journal article (peer-reviewed)abstract
- This paper introduces farm-heterogeneity in measuring technical efficiency of Swedish dairy farms using farm-level data. In calculating technical efficiency which is allowed to vary over time and across farms, we control for farm-specific effects. This is possible only when panel data is available. Furthermore, we separate technical efficiency from technical change-the presence of which is indicated by a shift in the production function over time, ceteris paribus. We also calculate percentage change in technical efficiency to examine whether farm efficiencies have improved over time. Finally, a comparison of technical efficiency, elasticities of different inputs, and technical change is made across different years and panels. The data includes four panels of dairy farms observed during the period 1976-1988, excluding 1985. ©1994 Kluwer Academic Publishers.
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