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Spanish virgin olive oil Designations of Origin. A technical efficiency analysis

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Authors: F. Vidal, J. Aparicio, J.T. Pastor y D. Pastor
Issue: 110-2 (208-222)
Topic: Agricultural Economics
Keywords: BAM, DEA, returns, scale efficiency.

Spain is the world’s leading olive oil producer and exporter; representing more than half of the EU’s production and around the 40% of the worldwide production. In markets where increasingly become more important the aspects related to the geographical origin of the products, the Protected Designations of Origin (PDO) are an essential tool for improving the competitiveness of those products that protect. This paper analyzes for Spain the technical efficiency of virgin olive oil PDOs in 2008-2010 period, resorting to the non-parametric methodology DEA (Data Envelopment Analysis), in particular the BAM models (Bounded Adjusted Measures), which allow us to consider all the possible sources of technical inefficiencies. The analyzed PDOs show in the period a relatively high technical efficiency, with values around 0.8, although with a continued downward trend in the last three-year period. It has also been found a higher efficiency in those PDO with a greater orientation to international markets.

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