Precision agriculture technology adoption and technical efficiency

We explore the relationship between precision agriculture (PA) technology adoption and technical efficiency using the 2016 USDA Agricultural Resource Management Survey (ARMS). Efficiency gains from PA are likely cumulative, that is, the true impact of precision farming depends on the integration of...

Full description

Saved in:
Bibliographic Details
Published in:Journal of agricultural economics 2022-02, Vol.73 (1), p.195-219
Main Authors: DeLay, Nathan D., Thompson, Nathanael M., Mintert, James R.
Format: Article
Language:English
Subjects:
Agricultural resources
Agricultural technology
Agriculture
Cluster analysis
Efficiency
Farms
precision agriculture
Precision farming
Resource management
stochastic frontier analysis
stochastic meta‐frontier analysis
Stochasticity
technical efficiency
Technology
Technology adoption
Technology utilization
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:We explore the relationship between precision agriculture (PA) technology adoption and technical efficiency using the 2016 USDA Agricultural Resource Management Survey (ARMS). Efficiency gains from PA are likely cumulative, that is, the true impact of precision farming depends on the integration of complementary tools. To examine the efficiency benefits of different PA bundles, we perform a two‐step analysis. First, we use cluster analysis to identify distinct producer groups based on patterns in PA technology adoption. These producer groups map naturally onto the classic technology adoption curve (laggards, late majority, early majority, innovators). Second, we use stochastic frontier analysis (SFA) and stochastic meta‐frontier analysis (SMFA) to estimate differences in technical efficiency between PA adoption groups. We find that farms with advanced PA technology bundles are significantly more technically efficient than non‐adopters. Differences in technical efficiency are not found to be driven by heterogeneous production technologies, but rather inefficiencies in input usage at the farm level. Our results have strong implications for farm consolidation in US agriculture.
ISSN:0021-857X
1477-9552
DOI:10.1111/1477-9552.12440