Causes of Efficiency Change in Transition: Theory and Cross-Country Survey Evidence from Agriculture
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Studies on efficiency changes in transition agriculture yield mixed results. This paper
develops both a theoretical model and an empirical analysis of how distribution of efficiency
scores changes with the various stages of transition. We use a unique set of representative
farm survey data to calculate farm level efficiency scores, compare the efficiency distributions
of different transition countries and correlate these with various indicators of particular
reforms. Our study indicates that, in particular, general institutional reforms and reforms
focused on market institutions and on reducing market imperfections in input and output
markets have an important positive impact on farm efficiency.