A new look at the decomposition of agricultural productivity growth incorporating weather effects

Random fluctuations in temperature and precipitation have substantial impacts on agricultural output. However, the contribution of these changing configurations in weather to total factor productivity (TFP) growth has not been addressed explicitly in econometric analyses. Thus, the key objective of...

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Bibliographic Details
Published in:PloS one 2018-02, Vol.13 (2), p.e0192432-e0192432
Main Authors: Njuki, Eric, Bravo-Ureta, Boris E, O'Donnell, Christopher J
Format: Article
Language:English
Subjects:
Agricultural production
Agricultural productivity
Agriculture
Annual precipitation
Biology and Life Sciences
Climate change
Decomposition
Earth Sciences
Econometric analysis
Econometrics
Efficiency
Environmental aspects
Fluctuations
Growing season
Heterogeneity
Hydrologic data
Methods
Parameter estimation
Precipitation
Precipitation-temperature relationships
Productivity
Social Sciences
Stochasticity
Temperature
Temperature effects
Weather
Weather effects
Weather mapping
Weather patterns
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Summary:Random fluctuations in temperature and precipitation have substantial impacts on agricultural output. However, the contribution of these changing configurations in weather to total factor productivity (TFP) growth has not been addressed explicitly in econometric analyses. Thus, the key objective of this study is to quantify and to investigate the role of changing weather patterns in explaining yearly fluctuations in TFP. For this purpose, we define TFP to be a measure of total output divided by a measure of total input. We estimate a stochastic production frontier model using U.S. state-level agricultural data incorporating growing season temperature and precipitation, and intra-annual standard deviations of temperature and precipitation for the period 1960-2004. We use the estimated parameters of the model to compute a TFP index that has good axiomatic properties. We then decompose TFP growth in each state into weather effects, technological progress, technical efficiency, and scale-mix efficiency changes. This approach improves our understanding of the role of different components of TFP in agricultural productivity growth. We find that annual TFP growth averaged 1.56% between 1960 and 2004. Moreover, we observe substantial heterogeneity in weather effects across states and over time.
ISSN:1932-6203
1932-6203
DOI:10.1371/journal.pone.0192432