Political violence and farm household efficiency

This paper estimates farm household levels of technical efficiency and their determinants in Colombia, with particular reference to political violence (i.e., guerilla fronts, assassinations, kidnappings, and displaced population). An input-oriented stochastic frontier is estimated simultaneously with a technical inefficiency model that incorporates violence at the local level, using survey data from 822 farm households. The findings show that household productivity is lower in areas of high political violence, particularly with high incidence of guerrilla fronts and kidnappings. Should political violence be eliminated, the average Farrell’s technical efficiency index of farm households in the sample would increase by an average of 6.4%, favoring households in small farms the most