What are the drivers of technical efficiency on organic farms in Germany? We analyze the efficiency of organic pasture farming in Germany using data from 1994/95 to 2005/06. Five inputs and one output are analyzed by means of a stochastic frontier production function, allowing for heteroscedasticity and technical effects. Our study contains a number of location factors, suggesting that the regional environment of a farm has a substantial influence on its efficiency.

Machinery is only one influencing factor of technical efficiency