GAZZOLA, R.

GOMES, E. G.

SOUZA, G. da S. e

WANDER, A. E.

English

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Using stochastic frontier approach to assess technical efficiency in Brazilian agriculture.

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Microeconomics: methodological approaches — PostersUsing Stochastic Frontier Approach to Assess Technical Efficiencyin Brazilian AgricultureGERALDO DA SILVA E SOUZA, ALCIDO ELENOR WANDER, ELIANE GONÇALVESGOMES, ROSAURA GAZZOLABrazilian Agricultural Research Corporation (EMBRAPA), BrazilBrazil is one of the most important countries in relation to agribusiness. Agribusinessrepresents about 25 % of Brazilian GDP, 36 % of exports in 2008 and 37 % of jobs in2008. The states of the South and Southeast historically, and more recently, the CenterWest use more technology, such as improved varieties of plants, fertilisers, irrigation(Center West), mechanisation and chemicals. Brazilian agriculture differs regionally,due, primarily, to the differences in geographical area, such as climate and naturalresources, and thus production characteristics. The objective of this study was to as-sess the technical efficiency of the agricultural sector in the 27 Brazilian states in theyears 1995/96 and 2006. The data on land and labour were obtained from the agricul-tural census of the two considered years. Data on credit for investment and runningcosts were obtained at the Brazilian Central Bank. In the analysis we used a DEACCR-O model and a stochastic frontier model. The second model better adjusted thedata with 99 % of correlation between predicted and observed values. The resultsshow Distrito Federal with the highest technical efficiency in agriculture in 2006 andthe second highest in 1995/96. The lowest technical efficiency was found in Piauíin 2006 and in Tocantins in 1995/96. The estimated elasticities show that increasesof 1 % in per capita income would increase the technical efficiency by 0.77 % in theNorth, by 0.76 % in the Northeast, by 0.59 % in the Center West, by 0.56 % in theSouth and by 0.49 % in the Southeast region. We fitted a DEA Model (CCR-O) anda stochastic frontier model to state agricultural production data in Brazil. The secondfit was very good as measured by a correlation of about 99 % between observed andpredicted values. The technology seems to show constant returns to scale.Keywords: Agriculture, stochastic frontier production, technical efficiencyContact Address: Alcido Elenor Wander, Brazilian Agricultural Research Corporation (EMBRAPA),National Rice and Beans Research Center (CNPAF), Rodovia GO-462, km 12, 75375-000 Santo Anto-nio de Goias, Brazil, e-mail: awander@cnpaf.embrapa.brID 188 487

http://www.alice.cnptia.embrapa.br/bitstream/doc/658207/1/UsingStochasticFrontierApproachtoAssess.pdf

Using stochastic frontier approach to assess technical efficiency in Brazilian agriculture.

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