Productivity change in Taiwan's farmers' credit unions: A nonparametric risk-adjusted Malmquist approach
Resource
Agricultural Economics 36 (2): 221-31
Journal
Agricultural Economics
Journal Volume
36
Journal Issue
2
Pages
221-231
Date Issued
2007
Author(s)
Abstract
This article proposes an extended three-stage DEA methodology similar to Fried et al. (2002) to improve the measurement of productivity growth when the assumption of free disposability of undesirable output does not apply. A directional distance function is used to construct adjusted Malmquist-Luenberger productivity indexes which simultaneously account for the impacts of undesirable outputs, environmental variables, and statistical noise. Panel data for 263 farmers' credit unions (FCUs) in Taiwan covering the 1998-2000 periods are employed to illustrate the advantages of this method. On average, the productivity of Taiwan's FCUs is found to have deteriorated over the 1998-2000 period. Although an improvement in efficiency has been observed, the major reason for the deterioration is found to be due to the regression of technology. © 2007 International Association of Agricultural Economists.
Subjects
Directional distance function; Malmquist-Luenberger productivity index; Three-stage DEA; Undesirable outputs
Other Subjects
agricultural finance; agricultural production; credit provision; environmental factor; index method; input-output analysis; Asia; Eurasia; Far East; Taiwan
Type
journal article
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