Abstract
Differences in technical efficiency across farms are one of the major factors explaining differences in farm survival and growth and changes in farm industry structure. This study employs Data Envelopment Analysis (DEA) to compute technical inefficiency scores for output, energy, materials, pesticides and fertiliser of a sample of Dutch indoor vegetable farms within the period 2006–2016. A bootstrap truncated regression model is used to determine statistical associations between producer-specific characteristics and technical inefficiency scores for the specified inputs. For the sample of indoor growers, the average technical inefficiency was about 14% for energy, 23% for materials, 24% for pesticides and 22% for fertilisers. The bootstrap truncated regression suggested that the degree of specialisation exerts adverse effects on the technical inefficiency of variable inputs. While age, short-term, long-term debt and subsidy were statistically significant, the coefficients were not economically significant. Building the capacity of farmers to reduce input inefficiency will enable farmers to be competitive and reduce the adverse effects of input overuse on the environment.
Highlights
The horticulture sector comprising greenhouse and open ground production of vegetables and flower is the highest value sector in Dutch agriculture, followed by grassland-based livestock keeping [1]
This study aims to measure input-specific technical inefficiency of Dutch specialist indoor vegetable farms and identify farm-specific characteristics associated with inefficiency
A similar trend of inputs inefficiency scores could be observed for constant returns to scale (CRS)
Summary
The horticulture sector comprising greenhouse and open ground production of vegetables and flower is the highest value sector in Dutch agriculture, followed by grassland-based livestock keeping [1]. Dutch horticulture is one of the most intensive production systems globally, with high output levels using the latest technologies [3, 4]. It is not surprising that the average use of inputs such as fertilisers and pesticides per unit of land area is high [5]. Such intense farming systems may improve the utilisation of resources; they, may have negative impacts on biodiversity, greenhouse gas (GHG) emissions and air and water pollution, among others [4]
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