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The role of energy productivity in U.S. agriculture

Author

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  • Ball, V.E.
  • Färe, R.
  • Grosskopf, S.
  • Margaritis, D.

Abstract

This paper investigates the role of energy on U.S. agricultural productivity using panel data at the state level for the period 1960–2004. We first provide a historical account of energy use in U.S. agriculture. To do this we rely on the Bennet cost indicator to study how the price and volume components of energy costs have developed over time. We then proceed to analyze the contribution of energy to productivity in U.S. agriculture employing the Bennet–Bowley productivity indicator. An important feature of the Bennet–Bowley indicator is its direct association with the change in (normalized) profits. Thus our study is also able to analyze the link between profitability and productivity. Panel regression estimates indicate that energy prices have a negative effect on profitability in the U.S. agricultural sector. We also find that energy productivity has generally remained below total farm productivity following the 1973–1974 global energy crisis.

Suggested Citation

  • Ball, V.E. & Färe, R. & Grosskopf, S. & Margaritis, D., 2015. "The role of energy productivity in U.S. agriculture," Energy Economics, Elsevier, vol. 49(C), pages 460-471.
    • Handle: RePEc:eee:eneeco:v:49:y:2015:i:c:p:460-471
    DOI: 10.1016/j.eneco.2015.03.006
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    2. Mohammadi, Mohammad & Noorollahi, Younes & Mohammadi-ivatloo, Behnam & Hosseinzadeh, Mehdi & Yousefi, Hossein & Khorasani, Sasan Torabzadeh, 2018. "Optimal management of energy hubs and smart energy hubs – A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 89(C), pages 33-50.
    3. Lang, Le Dang & Tiwari, Aviral Kumar & Hieu, Hoang Ngoc & Ha, Nguyen Minh & Gaur, Jighyasu, 2023. "The role of structural social capital in driving social-oriented sustainable agricultural entrepreneurship," Energy Economics, Elsevier, vol. 124(C).
    4. Chen, Xiang & Wang, Yujia & Wu, Xin, 2022. "Exploring the source of the financial performance in Chinese banks: A risk-adjusted decomposition approach," International Review of Financial Analysis, Elsevier, vol. 80(C).
    5. Sadeghi, Seyed Hamidreza & Sharifi Moghadam, Ehsan & Delavar, Majid & Zarghami, Mahdi, 2020. "Application of water-energy-food nexus approach for designating optimal agricultural management pattern at a watershed scale," Agricultural Water Management, Elsevier, vol. 233(C).

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    More about this item

    Keywords

    Energy productivity; Bennet–Bowley indicator; Agricultural productivity;
    All these keywords.

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • Q10 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - General
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General

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