Epsilon Archive for Student Projects

Abstract

This thesis examines the efficiency and sustainability of Swedish agriculture, with a particular focus on fertilizer use, through a two-stage stochastic frontier analysis (SFA) framework. Using farm-level panel data from the EU Farm Accountancy Data Network (FADN), technical efficiency (TE) is estimated for field crop, dairy, and grazing livestock farms via Translog production functions. To account for structural and technological heterogeneity, a meta-frontier approach is applied, yielding Technology Gap Ratios (TGR) and Meta-Technical Efficiency (MTE) scores.
Fertilizer Use Efficiency (FUE) is derived from a Cobb-Douglas specification to evaluate input-specific performance and is complemented by the estimation of Meta-FUE (MTFUE) and Fertilizer Overuse Efficiency (FOUE). These indicators enable a multidimensional assessment of both economic and environmental efficiency.
The results indicate that dairy farms exhibit high TE and MTFUE, while field crop farms show the lowest fertilizer efficiency and the highest overuse. Grazing livestock farms display moderate input efficiency but face the widest technology gaps. The study also explores how structural and policy-related variables—such as subsidies, farm size, and regional location—affect inefficiency.
Overall, the findings reveal substantial heterogeneity across farm types in both productivity and sustainable input use, offering evidence-based insights for more targeted and differentiated agricultural and environmental policy design in Sweden.