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Estimating Farm Productivity Differentials using Panel Data: The Hausman‐Taylor Approach
Author(s) -
Gardebroek Cornelis,
Lansink Alfons Oude
Publication year - 2003
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/j.1477-9552.2003.tb00068.x
Subject(s) - panel data , productivity , estimator , econometrics , pig breeding , total factor productivity , economics , production (economics) , fixed effects model , agricultural economics , statistics , agricultural science , mathematics , environmental science , microeconomics , economic growth
This paper investigates the relation between unobserved farm productivity and other production factors in a system of netput equations for specialised pig breeding farms in the Netherlands. In order to estimate the system, a Hausman‐Taylor panel data estimator is developed for a system of equations with unbalanced panel data. Tests on the correlation between model variables and farm‐effects are performed, yielding an insight into the sources of differences in total factor productivity and its components (e.g. managerial ability and scale economies). Results indicate that specialised pig breeding farms that are characterised by high total factor productivity have more buildings and machinery than farms with low total factor productivity.