Measuring multiple and single factor technical efficiency in organic farming

Abstract

Estimates the output‐oriented and input‐specific technical efficiency in two samples of Greek, durum wheat farms – organic and conventional ones – using Kalirajan and Obwona’s stochastic varying coefficient regression model. Findings indicate that the organic wheat farms examined are relatively more efficient. Reasons may include lower profit margins and restrictions on inputs permitted, which may force organic farmers to be more cautious with input use. However, technical efficiency scores are still relatively low for both types of wheat farming. Therefore, considerable scope for cost reducing and farm income improvement may exist in both farming modes. This realization could prove crucial for the long‐run viability and the future course of organic wheat farming.