Technical efficiency and productivity analysis of Spanish citrus farms

Spain occupies the first position in the European and Mediterranean rankings of citrus production and trade. Given the relevance of this sector, the main purpose of this study is to analyze its technical efficiency (TE) using the stochastic frontier model (SF) and decompose its productivity growth into various components using primal approach. We use a farm-level data for a sample of farms specialized in orange production. Results indicate that Spanish citrus farms improved their efficiency during the period studied at a rate of 9.5%, (the estimated average efficiency level for our sample is 64.11%); they also show evidence in favour of an increase in total factor productivity at a rate of 2.7% per year. Allocation efficiencies, technical efficiency change, and scale effects were found to be the main factors that caused this growth in TFP.