Efficiency analysis of dairy farms in the province of Izmir (Turkey): Data envelopment analysis (DEA)

The production efficiency of dairy farms based on cross section data of 2003 covering 80 farms chosen by the method of proportional sampling, was determined by Data Envelopment Analysis (DEA) using three outputs and seven inputs. Fortynine percent of the dairy farms appeared to be fully efficient according to the assumption of constant return to scale (CRS). The average efficiency indices obtained under CRS and variable return to scale (VRS) were 0.934 and 0.954, respectively. Mean scale efficiency, on the other hand, was 0.978. Out of the selected dairy farms 21.2% were observed to be efficient in measuring the efficiency of single output milk production. Average efficiency indices under CRS and VRS and scale efficiency index were measured to be 0.782, 0.832 and 0.938, respectively. This information will contribute to extensive dairy farm projects to be carried out in future.