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Embodied-Technical Change of Farm Tractors in U.S. Agricultural Productivity Analysis: What Does Hedonic Price Tell Us?

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  • Wang, Sun Ling
  • Schimmelpfennig, David
  • Ball, Eldon

Abstract

This study employs new data and a hedonic function to estimate the quality-adjusted price and quantity for farm tractors over the 1950-2011 period. The estimated hedonic prices for tractors are lower than the BLS’ tractor price index in most time period. The lower prices will result in a higher estimate of tractor stock and service flow, which reflects an increase in embodied technical change of farm tractors. After replacing the BLS deflator of tractor investment with these hedonic estimates, average annual TFP growth dropped by 0.13 percentage points over the 1991-2011 period compared with the current USDA’s productivity estimate. The changes can be attributed to properly accounting for embodied technical change in farm tractors over this period.

Suggested Citation

  • Wang, Sun Ling & Schimmelpfennig, David & Ball, Eldon, 2013. "Embodied-Technical Change of Farm Tractors in U.S. Agricultural Productivity Analysis: What Does Hedonic Price Tell Us?," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 151211, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea13:151211
    DOI: 10.22004/ag.econ.151211
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    References listed on IDEAS

    as
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    Keywords

    Agribusiness; Demand and Price Analysis; Production Economics;
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