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European Review of Agricultural Economics Advance Access originally published online on February 13, 2006
European Review of Agricultural Economics 2006 33(1):93-118; doi:10.1093/erae/jbi036
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© Oxford University Press and Foundation for the European Review of Agricultural Economics 2006; all rights reserved. For permissions, please email journals.permissions@oxfordjournals.org

Production risk and technical inefficiency in Russian agriculture

Raushan Bokusheva and Heinrich Hockmann

Institute of Agricultural Development in Central and Eastern Europe (IAMO), Halle, Germany

Corresponding author: Raushan Bokusheva, Institute of Agricultural Development in Central and Eastern Europe (IAMO), Theodor-Lieser-Str. 2, 06120 Halle, Germany. E-mail: bokusheva@iamo.de

Received June 2004; Revision received October 2005. This study investigates production risk and technical inefficiency as two possible sources of the production variability that characterised Russian agriculture during the last decade. The empirical analysis is conducted using panel data from 1996 to 2001 on 443 large agricultural enterprises from three regions in central, southern and Volga Russia. A production function specification accounting for the effect of inputs on both risk and technical inefficiency is found to describe production technologies of Russian farms more appropriately than the traditional stochastic frontier formulation.

Keywords: production risk, technical efficiency, panel data, Russian agriculture


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