Identifying different technologies using a latent class model: extensive versus intensive dairy farms

In this article, we use a stochastic frontier latent class model to estimate the technology of dairy farms according to their degree of intensification. The results are compared with a model which assumes that the technology is common to all farms. The empirical analysis uses data on a balanced panel of 130 Spanish dairy farms over the period 1999-2006. We find that the intensive technology is more productive than the extensive one and that intensive farms are more technically efficient than extensive farms.