Examining the Relationship between Social Inefficiency and Financial Performance. Evidence from Wisconsin Dairy Farms
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Division of Applied Social Sciences, University of Missouri, 124 Mumford Hall, Columbia, MO 65211, USA
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Department of Food Business & Development, University College Cork, O’Rahilly Building, College Rd, T12 K8AF Cork, Ireland
3
Department of Animal and Dairy Sciences, University of Wisconsin, 1675 Observatory Dr., 434 Animal Sciences Building Madison, Madison, WI 53706, USA
*
Author to whom correspondence should be addressed.
Sustainability 2021, 13(7), 3635; https://doi.org/10.3390/su13073635
Received: 3 February 2021
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Revised: 6 March 2021
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Accepted: 22 March 2021
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Published: 25 March 2021
Although social sustainability is an important component of sustainable agricultural production, little research has been conducted to assess social sustainability performance at the farm level. This study measures farmers’ social sustainability performance using (in)efficiency measures derived from a non-parametric dynamic directional distance function approach. It further examines the relationship between social (in)efficiency and financial performance measured by profitability, which is crucial to understand the financial impact of engaging in socially responsible activities. The empirical application focuses on a sample of Wisconsin dairy farms over the period 2007–2017. Results show that sample farms could have (decreased/)increased their social (in)efficiency by an average of 14%. Social (in)efficiency was found to be (negatively/)positively related to farm profitability, implying that social objectives can be achieved in tandem with economic goals.
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Keywords:
social inefficiency; social sustainability; financial performance; data envelopment analysis; dairy farms
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MDPI and ACS Style
Skevas, T.; Skevas, I.; Cabrera, V.E. Examining the Relationship between Social Inefficiency and Financial Performance. Evidence from Wisconsin Dairy Farms. Sustainability 2021, 13, 3635. https://doi.org/10.3390/su13073635
AMA Style
Skevas T, Skevas I, Cabrera VE. Examining the Relationship between Social Inefficiency and Financial Performance. Evidence from Wisconsin Dairy Farms. Sustainability. 2021; 13(7):3635. https://doi.org/10.3390/su13073635
Chicago/Turabian StyleSkevas, Theodoros, Ioannis Skevas, and Victor E. Cabrera. 2021. "Examining the Relationship between Social Inefficiency and Financial Performance. Evidence from Wisconsin Dairy Farms" Sustainability 13, no. 7: 3635. https://doi.org/10.3390/su13073635
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