Probabilistic measures of efficiency and the influence of contextual variables in nonparametric production models: an application to agricultural research in Brazil

In a research institution it is important to identify which management practices have influence on production efficiency. In this paper we assess the statistical significance of contextual variables type, size, financial resources acquisition, intensity of partnerships, processes improvements and management change. The analysis is carried out for the Brazilian Agricultural Research Corporation over the period 1999–2006. The statistical analysis uses a balanced dynamic panel data model. We conclude that only financial resources acquisition is statistically significant. The association with the production process is positive. We also found the two lag inertial components of the conditional FDH to unconditional FDH ratio statistically significant, indicating a 2-year effort to improve efficiency.