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.