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Evaluating dynamics, sources and drivers of productivity growth at the farm level

Author

Listed:
  • Raushan Bokusheva

    (OECD)

  • Lukáš Čechura

    (Czech University of Life Sciences Prague)

Abstract

This report measures and evaluates total factor productivity (TFP) of crop farms in the European Union (EU) in the period after the implementation of a series of important reforms of the EU Common Agricultural Policy (CAP). The analysis covers six EU Member states: the Czech Republic, France, Germany, Hungary, Poland and the United Kingdom. The data used in the analysis are based on the Farm Accountancy Data Network (FADN) data provided by the European Commission. To investigate sources of productivity growth, TFP is decomposed into three components – technical change, scale effect and technical efficiency. Technical change was found to be major source of productivity growth for most country samples for the two analysed periods. Technologies currently applied on crop farms were estimated to exhibit substantial economies of scale and therefore favour large-scale operations. However, economies of scale are not fully exploited which suggests the presence of some institutional constraints on farm growth. Large farms appear to be in a better position to exploit economies of scale; for West European countries covered in the report they were also found to exhibit larger persistent technical inefficiencies. Farm support payments were found to negatively influence crop farm productivity and efficiency of input use. More decoupled payments appear to be less distorting than other forms of support. A meta-level analysis of allocative efficiency shows that farms tend to be overcapitalised but to show relatively low allocative inefficiencies in their variable input use decisions. Substantial allocative inefficiencies appear also to exist in land and labour use. No significant economies of scope were found for the analysed crop production systems and levels of output aggregation. Farm flexibility was revealed to be determined mainly by the scale and convexity effects enabling cost efficient adjustments in the size of farm operations.

Suggested Citation

  • Raushan Bokusheva & Lukáš Čechura, 2017. "Evaluating dynamics, sources and drivers of productivity growth at the farm level," OECD Food, Agriculture and Fisheries Papers 106, OECD Publishing.
  • Handle: RePEc:oec:agraaa:106-en
    DOI: 10.1787/5f2d0601-en
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    Citations

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    Cited by:

    1. Lukáš Čechura & Tinoush Jamali Jaghdani, 2021. "Market Imperfections within the European Wheat Value Chain: The Case of France and the United Kingdom," Agriculture, MDPI, vol. 11(9), pages 1-21, August.
    2. Lukáš Čechura & Zdeňka Žáková Kroupová & Irena Benešová, 2021. "Productivity and Efficiency in European Milk Production: Can We Observe the Effects of Abolishing Milk Quotas?," Agriculture, MDPI, vol. 11(9), pages 1-21, August.
    3. Tohidi, Amirhossein & Ghorbani, Mohammad & Karbasi, Ali-Reza & Asgharpourmasouleh, Ahmadreza & Hassani-Mahmooei, Behrooz, 2020. "Comparison of Fuzzy Multi-Criteria Decision-Making Methods to Rank Business Strategies and Marketing Resources," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    4. Adamides, George, 2020. "Heuristic Evaluation of the User Interface for a Semi-Autonomous Agricultural Robot Sprayer," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    5. Pánková, Ludmila & Aulová, Renata & Jarolímek, Jan, 2020. "Economic Aspects of Precision Agriculture Systems," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    6. Anna Nowak & Renata Kubik, 2019. "Changes in Agricultural Productivity in New and Old Member States of the European Union," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 101-114.
    7. Edoardo Baldoni & Roberto Esposti, 2018. "Agricultural Productivity in Space - An econometric assessment on Italian farm-level data," Working Papers 428, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    8. Eliška Svobodová & Radka Redlichová & Gabriela Chmelíková & Ivana Blažková, 2022. "Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic," Agriculture, MDPI, vol. 12(10), pages 1-18, September.
    9. Čechura, Lukáš & Jamali Jaghdani, Tinoush & Samoggia, Antonella, 2020. "Imperfections in Italian Tomato Food Chain," 60th Annual Conference, Halle/ Saale, Germany, September 23-25, 2020 305591, German Association of Agricultural Economists (GEWISOLA).
    10. Lukáš Čechura & Zdeňka Žáková Kroupová, 2021. "Technical Efficiency in the European Dairy Industry: Can We Observe Systematic Failures in the Efficiency of Input Use?," Sustainability, MDPI, vol. 13(4), pages 1-19, February.
    11. Adamides, George, 2020. "Heuristic Evaluation of the User Interface for a Semi-Autonomous Agricultural Robot Sprayer," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    12. Ibe, Rebecca & Rahji, Mohammed & Adeoti, Adetola & Adenegan, Kemisola, 2020. "Household Demand for Fruits and Vegetables in Rural and Urban South-Western Nigeria," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    13. Thuy, Phan Thi & Niem, Le Duc & Lebailly, Philippe, 2020. "Recent Evolution of Perennial Crop Farms: Evidence from Dak Lak Province, Vietnam," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    14. Žáková Kroupová, Zdeňka & Hálová, Pavlína & Rumánková, Lenka, 2020. "Productivity of Czech Milk Production in European Comparison," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    15. Martini, Bruno Guilherme & Helfer, Gilson Augusto & Barbosa, Jorge Luis Victória & Modolo, Regina Célia Espinosa & da Silva, Marcio Rosa & de Figueiredo, Rodrigo Marques, 2020. "Prediction and Context Awareness in Agriculture: A Systematic Mapping," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    16. Čechura, Lukáš & Jamali Jaghdani, Tinoush, 2021. "Market imperfections within the European wheat value chain: The case of France and the United Kingdom," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 11(9).
    17. Jana LOSOSOVÁ & Radek ZDENĚK & Jaroslav SVOBODA, 2020. "Tangible fixed assets in Czech small and middle-sized farms Abstract: The aim of this paper is to analyse the development, structure and efficiency of tangible fixed assets in the Czech farms and iden," Eastern Journal of European Studies, Centre for European Studies, Alexandru Ioan Cuza University, vol. 11, pages 236-251, June.
    18. Exenberger, Emil & Bucko, Jozef, 2020. "Analysis of Online Consumer Behavior - Design of CRISP-DM Process Model," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    19. Lukáš Čechura & Zdeňka Žáková Kroupová & Antonella Samoggia, 2021. "Drivers of Productivity Change in the Italian Tomato Food Value Chain," Agriculture, MDPI, vol. 11(10), pages 1-17, October.
    20. Čechura, Lukáš & Jamali Jaghdani, Tinoush & Samoggia, Antonella, 2020. "Imperfections in Italian Tomato Food Chain," 60th Annual Conference, Halle/ Saale, Germany, September 23-25, 2020 305591, German Association of Agricultural Economists (GEWISOLA).
    21. Prokopchuk, Olena & Prokopchuk, Ihor & Mentel, Grzegorz & Bilan, Yuriy, 2020. "Parametric Insurance as Innovative Development Factor of the Agricultural Sector of Economy," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    22. Kartal, Serkan & Choudhary, Sunita & Stočes, Michal & Šimek, Pavel & Vokoun, Tomáš & Novák, Vojtěch, 2020. "Segmentation of Bean-Plants Using Clustering Algorithms," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 12(3), September.
    23. Žáková Kroupová, Zdeňka & Hálová, Pavlína & Rumánková, Lenka, 2020. "Productivity of Czech Milk Production in European Comparison," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 10(3), September.

    More about this item

    Keywords

    agriculture; economies of scope; European Union; farm flexibility; Total Factor Productivity;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • 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; Animal Welfare Policy

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