Measuring cost efficiency and allocative efficiency on farms which produce some agricultural products

Silvana Mustafaj, Parashqevi Rrapo, Albina Basholli
Fakulteti i Ekonomisë dhe Agrobiznesit, UB Tiranë


Cost efficiency and allocative efficiency in agricultural production in our country deserve special attention due to the importance of the decision on the distribution of available resources. The objective of this study is to measure cost efficiency (CE) and allocative efficiency (AE), through the principle of cost minimization, using the DEA model (Date Envelopment Analysis).
DEA method is applied to the data obtained in a group of small farms agricultural districts of Delvina and Saranda, for the year 2010-2011. These farms operate in many production systems multi-input/multi-output and cultivate agricultural products of the same type.

Keywords: Cost efficiency, allocative efficiency, data envelopment analysis

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