Unlocking aquaculture performance: Beyond cost efficiency and the role of heterogeneity

In recent years, the aquaculture industry has faced increasing competition, which negatively impacts firm performance. Despite the growing importance of the industry, there is limited research evaluating both cost and profit efficiency while considering heterogeneity across firms. This study aims to fill this gap by estimating the efficiency of costs and profits in aquaculture in Spain via a stochastic frontier Bayesian model with random coefficients. This methodological approach enables a more accurate and differentiated assessment of firm performance by explicitly incorporating technological heterogeneity across firms. The results show that cost efficiency significantly exceeds profit efficiency, which indicates that aquaculture firms manage their costs more efficiently than their revenues. From the resource-based view (RBV), this suggests that firms may not be fully leveraging their unique resources and capabilities to increase revenue, possibly due to strategic or market limitations. The findings indicate that firms could enhance performance by more than 50 % if they achieved full profit efficiency, which highlights the critical role of resource optimization. These insights have significant implications for both scholars and managers, and highlight the need to identify, develop, and leverage internal resources to strengthen the competitive position of aquaculture firms.