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Technical Efficiency of Grain Production in Ukraine

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Abstract

Using a representative sample of Ukrainian state and collective grain-producing farms, the authors estimate a stochastic production frontier model with technical inefficiency effects. Technical efficiency declined from 1989 to 1992. More experienced managers were found to be more productive, with the effect of experience diminishing with age. The authors find that on-farm provision of production infrastructure is associated with higher efficiency, a result supporting the hypothesis that disorganization causes output to decline in transition economies.

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