Productivity and efficiency analysis of horticultural co-operatives

Development of the horticultural sector in the Mediterranean agricultural areas of Spain is closely linked to the activity of co-operative organisations for the production and marketing of produce. These entities are especially important in finding answers to current demand requirements in the food market, bearing in mind the small family-scale nature of many of the farm enterprises in this sector. The present paper explores the ability of horticultural co-operatives in adapting to the new challenges in this sector from a productivity analysis viewpoint. Total factor productivity and efficiency are considered indicative measurements of the response of these organisations to the current market environment. In this study, Malmquist productivity indices are estimated using non-parametric techniques and taking as reference panel data of Andalusian horticultural co-operatives for the period 1995-2004. For a more in-depth analysis, productivity indices are broken down into technological change and efficiency change indicators, also considering the impact of other variables of co-operatives. The indicators obtained showed a relevant increase in efficiency for the period under study and a positive relationship between the results and quality investment. On the whole this research work adds to studies in the adaptation process of co-operatives in the current competitive scenario, offering insight into the improvement in total productivity and its correlation with several management variables in the fruit and vegetables sector.