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Total factor productivity change of agriculture in five Southern European countries

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  • Reziti, Ioanna

Abstract

The aim of this paper is to compute the Total Factor Productivity (TFP) change in the agricultural sector of five Southern European countries (Greece, Spain, Italy, Cyprus and Portugal) during 2007-2018. We measure TFP change using the Färe-Primont index that satisfies a set of basic axioms from index theory (e.g., identity, proportionality, transitivity). By decomposing this index, estimates of technical change and technical efficiency as well as scale and mix efficiency are obtained. The results show that Cyprus is the most productive country and the only one that experiences an increase in TFP due to both technical progress and improvement in scale and mix efficiency. The rest of the countries face TFP declines over time due to declining scale and mix efficiency. Technical progress was not adequate to offset the deterioration in efficiency. Policy implications of these results are that countries should continue to pursue technical progress and to improve scale and mix efficiency by changing at least one input and at least one output.

Suggested Citation

  • Reziti, Ioanna, 2019. "Total factor productivity change of agriculture in five Southern European countries," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 0(Issue 2).
    • Handle: RePEc:ags:aergaa:330640
    DOI: 10.22004/ag.econ.330640
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    References listed on IDEAS

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