Farms specialization, economic size and technical efficiency in Italian farms using a non-parametric approach

Nicola Galluzzo

Abstract: Italian farms are characterized by small dimensions in terms of land capital endowment and also in terms of economic size that are two bottlenecks influencing the technical efficiency. The main purpose of this paper was to assess by a non-parametric input-oriented model the technical efficiency in all Italian farms since 2004 to 2019 investigating if the farms specialization and economic size are pivotal variables influencing the technical efficiency. Results have underlined as the dimension of farms in terms of economic size is not so determinant for the technical efficiency. By contrast, the specialization of farms is the main factor able to act to the technical efficiency. In fact, horticulture farms have had the highest level of technical efficiency and the mixed farms the lowest. This research has partially filled the gap in the Italian economic literature investigating the relationships between economic dimension of farms and technical efficiency.

Keywords: Common Agricultural Policy; Data Envelopment Analysis; labour; second pillar; small farms

Date published: 2022-02-16