Components of agricultural productivity change: Replication of US evidence and extension to the EU

Increasing agricultural productivity is a policy priority in many countries. O'Donnell (Am. J. Agric. Econ. 94(4): 873–890, 2012) decomposed productivity change in US agriculture using a Lowe total factor productivity (TFP) index. We replicate the original study, assess its robustness to altern...

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Bibliographic Details
Published in:Applied economic perspectives and policy 2023-09, Vol.45 (3), p.1332-1355
Main Authors: Wimmer, Stefan, Dakpo, K Hervé
Format: Article
Language:English
Subjects:
Agricultural production
agricultural productivity
Agriculture
Economics and Finance
Humanities and Social Sciences
index measurement
Productivity
productivity decomposition
technical change
total factor productivity
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Summary:Increasing agricultural productivity is a policy priority in many countries. O'Donnell (Am. J. Agric. Econ. 94(4): 873–890, 2012) decomposed productivity change in US agriculture using a Lowe total factor productivity (TFP) index. We replicate the original study, assess its robustness to alternative TFP indices, and extend the analysis to EU agriculture. We consistently find that productivity growth in US agriculture is mainly driven by technical progress. In EU agriculture, TFP growth is less pronounced, and both technical change and efficiency change contribute to productivity changes. In both US and EU agriculture, the magnitude of measured productivity change varies across indices, highlighting the need to rely on multiple indices for robust policy recommendations.
ISSN:2040-5790
2040-5804
DOI:10.1002/aepp.13377