TECHNICAL EFFICIENCY AND RETURNS TO SCALE IN DAIRY PRODUCTION Ayele Gelan and Beatrice Muriithi Market Opportunities Theme, ILRI, Nairobi, Kenya The 5 th All Africa Conference on Animal Agriculture, held at United Nation Conference Centre, Addis Ababa, Ethiopia October 25-28, 2010
17
Embed
Technical efficiency and returns to scale in dairy production.
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
TECHNICAL EFFICIENCY AND RETURNS TO SCALE IN DAIRY PRODUCTION
Ayele Gelan and Beatrice Muriithi Market Opportunities Theme, ILRI, Nairobi, Kenya
The 5th All Africa Conference on Animal Agriculture, held at United Nation Conference Centre, Addis Ababa, Ethiopia
October 25-28, 2010
TOPICS OF DISCUSSIONTOPICS OF DISCUSSION Study context
Objectives and motivations
Methodological issues
Results
Conclusions
STUDY CONTEXTSTUDY CONTEXT EADD – East African Dairy Development
– Large project covering 42 target districts in 3 EA
countries (Kenya 17, Rwanda 10, and Uganda 15)
– Hub approach – integrated interventions, along the
dairy value chain (feed, breeding, BDS, etc)
– Overall objective – doubling dairy income by the end
of the project timescale , 10th year
Baseline survey
– 1275 households in 17 representative districts
– Sub-sample of 371 farms selected for this study
OBJECTIVES AND MOTIVATIONSOBJECTIVES AND MOTIVATIONS Performance indicators guide resource
allocation decisions Interventions often target economic
performance benchmarks, e.g. milk per cow per day
However, such measures are partial productivity indicators (biophysical relationships, weak economic meaning)
They ignore farm-specific optimizations within a group
Hence, there is a need for rigorous efficiency indicators their determinants
DEA - CONCEPTSDEA - CONCEPTS Decision making units - DMUs, e.g. farms
Multiple inputs xi,j and multiple inputs yk,j
Relative efficiency of each farm
Where uk and vi represent output and input weights, respectively
Weights are specifically determined for each output and input category and hence represent decision variables
Transform the above relationships into an LP problem and solve for efficiency scores