Economic performance among Norwegian crop farms accounting for farm management and socio-economic factors

The objective of this paper is to examine the economic performance of crop-producing farms accounting for unobserved heterogeneity, environmental variables, and regions. The empirical analysis was based on a translog cost function and unbalanced farm-level panel data for 1991-2013 from the 455 crop-producing farms with 3,885 observations (1,004 observations from the central region and 2,881 observations from the eastern region). We found that the mean minimum costs were about 93% and 92% of the actual costs for crop farms in the central and eastern regions, respectively. The marginal effects of crop rotation, land tenure, off-farm activity, direct government support, and experience were positively associated with crop farm economic performance. The marginal contribution of these variables on economic performance increased in the years 2000-2013 compared with the years 1991-1999 in both regions.