To specialize or not to specialize?—A technical efficiency analysis in three transition economies

Abstract

We provide evidence on the recommendable crop allocation levels from a technical efficiency (TE) perspective, considering heterogeneous farming systems across regions and countries. Towards this aim, we employ a latent profile analysis to identify the main patterns of crop systems among a random sample of 2,830 crop farms from Kyrgyzstan, Mongolia and Uzbekistan. Using a stochastic frontier analysis, we calculate TE scores for the identified crop profiles to examine the relationship between diversification portfolios and TE. We find that, on average, diversified crop profiles exhibit the highest TE scores, particularly those with a greater emphasis on dual-season grain crops. Meanwhile, the specialized farm profile tends to show the lowest average TE score.