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New perspectives on farm size and productivity

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  • Rada, Nicholas E.
  • Fuglie, Keith O.

Abstract

The farm size and productivity debate has been limited by the focus on land or labor productivity, generally showing respective productivity advantages to smaller or larger sized farms. Our purpose is to provide new perspectives on the debate by bringing together evidence from a set of novel case studies in both rich and poor countries. Common to them are the adoption of total factor productivity (TFP) as the comparative performance measure, and the reliance on panels of farm micro data. The present article presents a synthesis of findings from five case studies in (i) Malawi, Tanzania, and Uganda; (ii) Bangladesh; (iii) Brazil; (iv) Australia; and (v) the United States. The preponderance of evidence from these studies suggests that there is no single economically optimal agrarian structure; rather, it appears to evolve with the stage of economic development. Certain farm sizes face relative productivity advantages, such as small farms in Africa. But with economic and market growth, that smallholder advantage will likely attenuate, moving toward constant and eventually increasing returns to size. Yet, importantly, small farms may be quite dynamic, and need not be a drag on agricultural growth until perhaps well into the development process.

Suggested Citation

  • Rada, Nicholas E. & Fuglie, Keith O., 2019. "New perspectives on farm size and productivity," Food Policy, Elsevier, vol. 84(C), pages 147-152.
  • Handle: RePEc:eee:jfpoli:v:84:y:2019:i:c:p:147-152
    DOI: 10.1016/j.foodpol.2018.03.015
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    More about this item

    Keywords

    Agrarian structure; Agriculture; Crop yields; Farm size; Land productivity; Total factor productivity (TFP);
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy

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