Technological differences in South African sheep production: a stochastic meta-frontier analysis

Abstract

ABSTRACT This study compared four South African sheep producing districts relative to each other and a common metafrontier to analyse within and between group efficiency and explored what could be learnt from this technique compared to simple frontiers. A sample was compiled from sources that were previously successfully used in local benchmarking exercises, and despite very modest sample sizes at the group level and minimal information on how groups differ, the group models performed adequately while the meta-model performed very well. The results revealed that while within group performances were comparable across districts, there were huge differences in between group performance. These differences are partly attributable to natural resource endowments, but institutional arrangements also contribute significantly to local success. This suggests that to achieve rural regeneration public–private partnerships are necessary to address this issue. State support is insufficient and producer organisations have a major role in promoting institutional innovation.