Technical Efficiency Assessment of Intensive and Traditional Olive Farms in Southern Italy

Teodora StillitanoGiacomo FalconeBruno Francesco NicolòClaudio Di GirolamoGiovanni GulisanoAnna Irene De Luca

DOI 10.7160/aol.2019.110208
No 2/2019, June
pp. 81-93

Stillitano, T., Falcone, G., Nicolò, B. F., Di Girolamo, C., Gulisano, G. and De Luca A. I. (2019) “Technical Efficiency Assessment of Intensive and Traditional Olive Farms in Southern Italy", AGRIS on-line Papers in Economics and Informatics, Vol. 11, No. 2, pp. 81-93. ISSN 1804-1930. DOI 10.7160/aol.2019.110208.

Abstract

Olive-growing plays an important role in Southern Italy’s agricultural sector. However, the profitability of many olive growing farms depends, still today, on public subsidies. The current changes in the European Common Agricultural Policy (CAP) 2014-2020, oriented towards the direct payments decreasing, will inevitably have important effects on farmer incomes. This is why the olive farms will have to increase their level of direct profi tability to ensure their resilience on the market. Therefore, the measurement of technical effi ciency plays a crucial role in identifying more efficient management practices, and for this aim, Data Envelopment Analysis (DEA) represents the most widely used technique in productivity analysis. In this paper, constant returns to scale and variable returns to scale input-oriented models were used to investigate the technical and scale efficiency of intensive and traditional olive farms in Southern Italy, in order to highlight the performance of each farm. Results showed technical inefficiencies in both olive systems and, suggesting that improvements in the input allocation among all farms are needed. Findings could be useful to suggest the adoption of management strategies to optimize the use of inputs, aiming to achieve suitable levels of productive performance.

Keywords

Olive-growing farms, scale efficiency, nonparametric analysis, Data Envelopment Analysis.

References

  1. Amores, A. F. and Contreras, I. (2009) “New approach for the assignment of new European agricultural subsidies using scores from data envelopment analysis: Application to olive-growing farms in Andalusia (Spain)”, European Journal of Operational Research, Vol. 193, No. 3, pp. 718-729. ISSN 0377-2217. DOI 10.1016/j.ejor.2007.06.059.
  2. Aparicio, J., Monge, J. F., Ortiz, L. and Pasto, J. T. (2016) “Changes in productivity in the virgin olive oil sector: An application to protected designations of origin in Spain”, Spanish Journal of Agricultural Research, Vol. 14, No. 3, 12 p. ISSN 2171-9292. DOI 10.5424/sjar/2016143-9433.
  3. Artukoglu, M. M., Olgun, A. and Adanacioglu, H. (2010) “The efficiency analysis of organic and conventional olive farms: Case of Turkey”, Agricultural Economics, Vol. 56, No. 2, pp. 89-96. ISSN 0139-570X.
  4. Banaeian, N., Omid, M. and Ahmadi, H. (2011) “Application of Data Envelopment Analysis to Evaluate Efficiency of Commercial Greenhouse Strawberry”, Research Journal of Applied Sciences, Engineering and Technology, Vol. 3, No. 3, pp. 185-193. ISSN 2040-7467.
  5. Banker, R. D., Charnes, A. and Cooper, W. W. (1984) “Some models for estimating technical and scale inefficiencies in Data Envelopment Analysis”, Management Science, Vol. 30, No. 9, pp. 1078-1092. ISSN 0025-1909. DOI 10.1287/mnsc.30.9.1078.
  6. Beltrán-Esteve, M. and Reig-Martínez, E. (2014) “Comparing conventional and organic citrus grower effi ciency in Spain”, Agricultural Systems, Vol. 129, pp. 115-123. ISSN 0308-521X. DOI 10.1016/j.agsy.2014.05.014.
  7. Bernardi, B., Benalia, S., Fazari, A., Zimbalatti, G., Stillitano, T. and De Luca, A. I. (2016) “Mechanical harvesting in traditional olive orchards: Oli-picker case study”, Agronomy Research, Vol. 14, No. 3, pp. 683-688. ISSN 1406-894X.
  8. Bernardi, B., Falcone, G., Stillitano, T., Benalia, S., Strano, A., Bacenetti, J. and De Luca, A. I. (2018a) “Harvesting system sustainability in Mediterranean olive cultivation”, Science of the Total Environment, Vol. 625, pp. 1446-1458. ISSN 0048-9697. DOI 10.1016/j.scitotenv.2018.01.005.
  9. Bernardi, B., Castro-García, S., Blanco-Roldán, G. L., Benalia, S., Fazari, A. and Zimbalatti, G. (2018b) “A comparison between two materials for head-clamping pads of olive tree shakers: First trials”, Acta Horticulturae, Vol. 1199, pp. 403-408. ISSN 2406-6168. DOI 10.17660/ActaHortic.2018.1199.64.
  10. Boubacar, O., Hui-qiu, Z., Rana, M. A. and Ghazanfar, S. (2016) “Analysis on Technical Efficiency of Rice Farms and Its Influencing Factors in South-western of Niger”, Journal of Northeast Agricultural University, Vol. 23, No. 4, pp. 67-77. ISSN 1006-8104. DOI 10.1016/S1006-8104(17)30009-0.
  11. Bravo-Ureta, B., Solís, D., Moreira-López, V., Maripani, J., Thiam, A. and Rivas, T. (2007) “Technical effi ciency in farming: a meta-regression analysis”, Journal of Productivity Analysis, Vol. 27, pp. 57-72. ISSN 0895-562X. DOI 10.1007/s11123-006-0025-3.
  12. Charnes, A., Cooper, W. W. and Rhodes, E. (1978) “Measuring the efficiency of decision-making units”, European Journal of Operational Research, Vol. 2, No. 6, pp. 429-444. ISSN 0377-2217. DOI 10.1016/0377-2217(78)90138-8.
  13. Clemente, F., Lírio, V.S. and Gomes, M. F. M. (2015): “Technical efficiency in Brazilian citrus production”, Bio-based and Applied Economics, Vol. 4, No. 2, pp. 165-178. ISSN 2280-6180. DOI 10.13128/BAE-13597.
  14. Cooper, W. W., Seiford, L. and Tone, K. (2007) “Data Envelopment Analysis: A Comprehensive Text with Models, Applications, References and DEA-Solver Software”, 2nd ed., New York, Springer US, 490 p. ISBN 978-0-387-45283-8.
  15. Cooper, W. W., Seiford, L. and Tone, K. (2006) “Introduction to Data Envelopment Analysis and Its Uses”, New York, Springer US, 354 p. ISBN 978-0-387-29122-2.
  16. Cooper, W. W., Seiford, L. and Zhu, J. (2011) “Handbook on Data Envelopment Analysis”, 2nd ed., New York, Springer US, 498 p. ISBN 978-1-4419-6151-8.
  17. De Luca, A. I., Iofrida, N., Falcone, G., Stillitano, T. and Gulisano, G. (2018a) “Olive growing scenarios of soil management: Integrating environmental, economic and social indicators rom a life-cycle perspective”, Acta Horticulturae, Vol. 1199, pp. 209-214. ISSN 2406-6168. DOI 10.17660/ActaHortic.2018.1199.34.
  18. De Luca, A. I., Falcone, G., Stillitano, T., Iofrida, N., Strano, A. and Gulisano, G. (2018b) “Evaluation of sustainable innovations in olive growing systems: A Life Cycle Sustainability Assessment case study in southern Italy”, Journal of Cleaner Production, Vol. 171, pp. 1187-1202. ISSN 0959-6526. DOI 10.1016/j.jclepro.2017.10.119.
  19. Dhungana, B. R., Nuthall, P. L. and Nartea, G. V. (2004) “Measuring the economic inefficiency of Nepalese rice farms using data envelopment analysis”, Australian Journal of Agricultural and Resource Economics, Vol. 48, No. 2, pp. 347-369. ISSN 1467-8489. DOI 10.1111/j.1467-8489.2004.00243.x.
  20. Emrouznejad, A. and Yang, G. L. (2018) “A survey and analysis of the first 40 years of scholarly literature in DEA: 1978-2016”, Socioeconomic Planning Science, Vol. 61, pp. 4-8. ISSN 0038-0121. DOI 10.1016/j.seps.2017.01.008.
  21. Farrell, M. J. (1957) “The Measurement of Productive Efficiency”, Journal of the Royal Statistical Society. Series A, Vol. 120, No. 3, pp. 253-290. ISSN 00359238. DOI 10.2307/2343100.
  22. FAO (2016) “Food and agriculture data”. [Online]. Available: http://www.fao.org/faostat/en/#home [Accessed: 25 July 2018].
  23. Galanopoulos, K., Aggelopoulos, S., Kamenidou, I. and Mattas, K. (2006) “Assessing the effects of managerial and production practices on the effciency of commercial pig farming”, Agricultural Systems, Vol. 88, pp. 125-141. ISSN 0308-521X. DOI 10.1016/j.agsy.2005.03.002.
  24. Giametta, G. and Bernardi, B. (2010) “Olive grove equipment technology. Straddling trees: Mechanized olive harvests”, Advances in Horticultural Science, Vol. 24, No. 1, pp. 64-70. ISSN 03946169.
  25. Gómez-Limón, J. A., Picazo-Tadeo, A. J. and Reig-Martínez, E. (2012) “Eco-efficiency assessment of olive farms in Andalusia”, Land Use Policy, Vol. 29, No. 2, pp. 395-406. ISSN 0264-8377. DOI 10.1016/j.landusepol.2011.08.004.
  26. Hosseinzadeh-Bandbafha, H., Safarzadeh, D., Ahmadi, E. and Nabavi-Pelesaraei, A. (2018) “Optimization of energy consumption of dairy farms using data envelopment analysis - A case study: Qazvin city of Iran”, Journal of the Saudi Society of Agricultural Sciences, Vol. 17, No. 3, pp. 217-228. ISSN 1658-077X. DOI 10.1016/j.jssas.2016.04.006.
  27. Idda, L., Fusi, R., Madau, F. A., and Rubino, C. (2004) “L’olivicoltura in Sardegna. Aspetti economici e prospettive alla luce di un’analisi aziendale”, Quaderni di Economia e Politica Agraria, No. 2., 102 p, Tipografia Gallizzi Editore. (In Italian).
  28. ISTAT (2010) “6th Italian agriculture census”. [Online]. Available: http://dati-censimentoagricoltura.istat.it/. [Accessed: 10 July 2018].
  29. ISTAT (2016) “Agriculture and livestock”. [Online]. Available: http://agri.istat.it/sag_is_pdwout/index.jsp. [Accessed: 10 July 2018].
  30. Jiao, W., Fu, Z., Mu, W., Zhang, X., Lu, J. and Xu, M. (2015) “Estimating technical efficiency of Chinese table grape wholesalers”, British Food Journal, Vol. 117, No. 6, pp. 1670-1688. ISSN 0007-070X. DOI 10.1108/BFJ-03-2014-0134.
  31. Joro, T. and Korhonen, P. J. (2015) “Extension of Data Envelopment Analysis with Preference Information: Value Efficiency”, New York, Springer US, 191 p. ISBN 978-1-4899-7528-7.
  32. Jurado, E. B., Moral, A. M., Uclés, D. F. and Viruel, M. J. M. (2017) “Determining factors for economic efficiency in the organic olive oil sector”, Sustainability, Vol. 9, No. 5, pp. 784. DOI 10.3390/su9050784.
  33. Khoshroo, A., Mulwa, R., Emrouznejad, A. and Arabi, B. (2013) “A non-parametric Data Envelopment Analysis approach for improving energy efficiency of grape production”, Energy, Vol. 63, pp. 189-194. ISSN 0360-5442. DOI 10.1016/j.energy.2013.09.021.
  34. Lansink, A. O. and Reinhard, S. (2004) “Investigating technical effciency and potential technological change in Dutch pig farming”, Agricultural Systems, Vol. 79, pp. 353-367. ISSN 0308-521X. DOI 10.1016/S0308-521X(03)00091-X.
  35. Liu, J. S., Lu, L. Y. Y., Lu, W. M. and Lin, B. J. Y. (2013) “A survey of DEA applications”, Omega, Vol. 41, No. 5, pp. 893-902. ISSN 0305-0483. DOI 10.1016/j.omega.2012.11.004.
  36. Mardani, M. and Salarpour, M. (2015) “Measuring technical effi ciency of potato production in Iran using robust data envelopment analysis”, Information Processing in Agriculture, Vol. 2. No. 1, pp. 6-14. ISSN 2214-3173. DOI 10.1016/j.inpa.2015.01.002.
  37. Mohammadi, A., Rafiee, S., Mohtasebi, S. S., Mousavi Avval, S. H. and Rafiee, H. (2011) “Energy efficiency improvement and input cost saving in kiwifruit production using Data Envelopment Analysis approach”, Renewable Energy, Vol. 36, No. 9, pp. 2573-2579. ISSN 0960-1481. DOI 10.1016/j.renene.2010.10.036.
  38. Mousavi-Avval, S.H., Mohammadi, A., Rafiee, S. and Tabatabaeefar, A. (2012) “Assessing the technical efficiency of energy use in different barberry production systems”, Journal of Cleaner Production, Vol. 27, pp. 126-132. ISSN 0959-6526. DOI 10.1016/j.jclepro.2012.01.014.
  39. Niavis, S., Tamvakis, N., Manos, B. and Vlontzos, G. (2018) “Assessing and explaining the efficiency of extensive olive oil farmers: The case of Pelion peninsula in Greece”, Agriculture, Vol 8, No 2, pp. 1-13. ISSN 2077-0472. DOI 10.3390/agriculture8020025.
  40. Ramanathan, R. (2003) “An Introduction to Data Envelopment Analysis”, New Delhi, Sage Publications, 208 p. ISBN 978-0761997610.
  41. Scardera, A. and Tosco, D. (2010) “Redditività delle aziende olivicole e impatto della riforma della PAC 2014-2020”, Italy, INEA, p. 79. (In Italian).
  42. Sola-Guirado, R. R., Bernardi, B., Castro-García, S., Blanco-Roldán, G. L., Benalia, S., Fazari, A., Brescia, A. and Zimbalatti, G. (2018) “Assessment of aerial and underground vibration transmission in mechanically trunk shaken olive trees”, Journal of Agricultural Engineering, Vol. 49, No. 3, pp. 191-197. ISSN 2239-6268. DOI 10.4081/jae.2018.788.
  43. Stillitano, T., De Luca, A. I., Iofrida, N., Falcone, G., Spada, E. and Gulisano, G. (2017) “Economic Analysis of Olive Oil Production Systems in Southern Italy”, Quality - Access to Success, Vol. 18, No. 157, pp. 107-112. ISSN 1582-2559.
  44. Stillitano, T., Falcone, G., De Luca, A.I., Spada, E., Gulisano, G. and Strano, A. (2018) “Long-term feasibility of Mediterranean olive production systems”, Acta Horticulturae, Vol. 1199, pp. 203-208. ISSN 2406-6168. DOI 10.17660/ActaHortic.2018.1199.33.
  45. Theodoridis, A., Ragkos, A., Roustemis, D., Galanopoulos, K., Abas, Z. and Sinapis, E. (2012) “Assessing technical efficiency of Chios sheep farms with data envelopment analysis”, Small Ruminant Research, Vol. 107, No. 2-3, pp. 85-91. ISSN 0921-4488. DOI 10.1016/j.smallrumres.2012.05.011.
  46. Toma, E., Dobre, C., Dona I. and Cofas, E. (2015) “DEA applicability in assessment of agriculture efficiency on areas with similar geographically patterns”, Agriculture and Agriculture Science Procedia, Vol. 6, pp. 704-711. ISSN 2210-7843. DOI 10.1016/j.aaspro.2015.08.127.
  47. Urso A., Timpanaro G., Caracciolo F., Cembalo, L. (2018) “Effi ciency analysis of Italian wine producers”, Wine Economics and Policy, Vol. 7, No. 1, pp. 3-12. ISSN 2212-9774. DOI 10.1016/j.wep.2017.11.003.
  48. Vidal, F., Pastor, J. T., Borras, F. and Pastor, D. (2013) “Efficiency analysis of the designations of origin in the Spanish wine sector”, Spanish Journal of Agricultural Research, Vol. 11, No. 2, pp. 294-304. ISSN 2171-9292. DOI 10.5424/sjar/2013112-3607.

Full paper

  Full paper (.pdf, 653.96 KB).