Broadacre farm productivity and profitability in south‐western Australia

This paper examines broadacre farm performance in south‐western Australia. This region has experienced pronounced climate variability and volatile commodity prices since the late 1990s. Relationships between productivity and profitability are explored using panel data from 47 farms in the study region. The data are analysed using nonparametric methods. By applying the Fare‐Primont index method, components of farm productivity and profitability are measured over the period 1998–2008. Growth in productivity is found to be the main contributor of profitability. Gains in efficiency and technical change are identified as jointly and similarly important in their contribution to total factor productivity for the farm sample in the region from 1998 to 2008. However, across environments, efficiency gains play an increasingly important role in influencing productivity as growing season rainfall increases. We conclude that R,D&E that delivers further improvement in technical efficiency and technical change is needed to support the profitability of farms across the study region.     

Decomposition of output growth in the Tunisian olive-growing sector: A frontier production function approach

The aim of this paper is to investigate the relative contribution of technical efficiency, technological change, and increased input use to the output growth of the Tunisian olive oil growing farms, using a stochastic frontier production function approach applied to panel data for the period 1995-1997. The proposed methodology is based on the use of a flexible translog functional form. Results indicate that technical efficiency of production in the sample of olive producing farms investigated ranges from a minimum of 24.8% to a maximum of 84.6% with an average technical efficiency estimate of 48.5%. This suggests that olive producers may increase their production by as much as 51.5% through more efficient use of production inputs. Further, the production is characterized by decreasing returns to scale, which on average was 0.8. Finally, investigation of the sources of production growth reveals that the contribution of conventional inputs (labor, in particular) and technical change are found to be the main source of that growth, since total factor productivity increased during the study period, but at a slowing rate.     

Sources of productivity growth on Finnish dairy farms—application of an input distance function

The objective is to examine sources of productivity change on Finnish dairy farms in the 1990s. The decomposition of productivity change into technical and technical efficiency change is widely recognized but it neglects the scale effect. Generalized decompositions incorporating all three components are calculated for a sample of Finnish dairy farms from 1989-2000. This period is of interest because of the drastic change in agricultural policy when Finland joined the European Union (EU) in 1995. The results indicate that productivity growth was on average low, approximately 0.15% per year. Neutral technical change was identified as the most important source of productivity growth (1.1%). Technical efficiency decreased by almost 0.5% annually. The contribution of the scale effect in productivity change increased towards the end of study period.     

Size and Productivity in the U.S. Milling and Baking Industries

From the late 1950s through mid-1990s, productivity growth in U.S. grain milling and feed manufacturing has been consistently strong and positive. In grain milling, approximately 15% of the growth is due to size economies. Technical change has been capital-using, increasingly material-saving, and, in recent years, decreasingly labor-saving or increasingly labor-using. The quality of capital has risen relative to that of labor and materials. In all but the baking industry, capital intensification and incentives for plant size growth remain unabated.     

Measuring and decomposing agricultural productivity and profitability change*

Profitability change can be decomposed into the product of a total factor productivity (TFP) index and an index measuring changes in relative prices. Many TFP indexes can be further decomposed into measures of technical change, technical efficiency change, scale efficiency change and mix efficiency change. The class of indexes that can be decomposed in this way includes the Fisher, Törnqvist and Hicks–Moorsteen TFP indexes but not the Malmquist TFP index of Caves, Christensen and Diewert (1982). This paper develops data envelopment analysis methodology for computing and decomposing the Hicks–Moorsteen index. The empirical feasibility of the methodology is demonstrated using country‐level agricultural data covering the period 1970–2001. The paper explains why relatively small countries tend to be the most productive, and why favourable movements in relative prices tend to simultaneously increase net returns and decrease productivity. Australia appears to have experienced this relative price effect since at least 1970. Thus, if Australia is a price‐taker in output and input markets, Australian agricultural policy‐makers should not be overly concerned about the estimated 15 per cent decline in agricultural productivity that has taken place over the last three decades.     

Patterns in Technical Efficiency and Technical Change at the Farm‐level in England and Wales, 1982–2002

English and Welsh farm‐level survey data are employed to estimate stochastic frontier production functions for eight different farm types (cereal, dairy, sheep, beef, poultry, pigs, general cropping and mixed) for the period 1982 to 2002. Differences in the relative efficiency of farms are explored by the simultaneous estimation of a model of technical inefficiency effects. The analysis shows that, generally, farms of all types are relatively efficient with a large proportion of farms operating close to the production frontier. However, whilst the frontier farms of all types are becoming more efficient through time because of technical change, it is also the case that the efficiency of the average farm for most farm types is increasing at a slower rate. In addition, annual mean levels of efficiency for most farm types have declined between 1982 and 2002. The factors that consistently appear to have a statistically significant effect on differences in efficiency between farms are: farm or herd size, farm debt ratios, farmer age, levels of specialisation and ownership status.     

Efficiency and Technical Change in the Philippine Rice Sector: A Malmquist Total Factor Productivity Analysis

Regional differences in total factor productivity, efficiency, and technological change in the Philippine rice sector are examined for the post-Green Revolution era. Malmquist productivity indices were constructed for 1971–90 and were decomposed into efficiency and technological change. The average annual Malmquist productivity growth was only slightly positive. Productivity growth was negative during the early 1970s, and was followed by a period of positive growth. Growth was negative again in the late 1980s. The period of positive growth coincided with the introduction of new rice varieties while the declines are likely to have been caused by intensification of rice production in lowland farming systems. Certain regions such as Central Luzon, Western Visayas, and Southern and Northern Mindanao had higher rates of technological change than others. This may be due to higher investments in infrastructure and education, increased adoption of tractors, and a better agroclimatic environment.     

Forty Years of Price Transmission Research in the Food Industry: Insights,Challenges and Prospects: Comment

Lloyd's review of the literature on food price transmission in the Journal of Agricultural Economics (2017) is incomplete in that it omits discussion of technical change and international trade. The purpose of this Comment is to explain why these topics are essential for a proper understanding of price transmission. As a by‐product of the discussion, I show that the pass‐through and pass‐back equations that serve as the basis for Lloyd's theoretical insights are more general than one might think based on Gardner's (American Journal of Agricultural Economics, 1975) discussion of these equations.     

Farm Size,Technology Adoption and Agricultural Trade Reform: Evidence from Canada

Using detailed census data covering over 30,000 farms in Alberta, Saskatchewan and Manitoba, Canada, we document the vast and increasing farm size heterogeneity, and analyse the role of farm size in adapting to the removal of an export subsidy in 1995. Consistent with the Alchian-Allen hypothesis, the increase in per-unit trade costs due to the reform was associated with farms of all sizes shifting their production of crops from low value wheat to higher value canola. We find that switching to new labour-saving tillage technologies and away from summerfallow in response to the large negative shock to grain prices caused by the reform varied across the farm size distribution. We develop a theory of heterogenous farms and technology adoption that can explain our findings.     

Evaluating Agricultural Productivity and Policy in Russia

Russia's transition to a market economy in the early 1990s shocked its agricultural sector, creating the potential for profit and gains from specialisation and productivity improvements. However, subsequent regional agricultural development has been highly uneven, and the sources of the sector's productivity improvement remain unclear. Drawing on a newly-assembled Russian regional farm production and policy dataset, we evaluate agricultural total factor productivity growth from 1994 to 2013, decomposing that growth into technical progress and efficiency gains, for the nation as a whole and for the major agricultural districts of the South and Central. We then test how investments in road and rail infrastructure and human capital have influenced those gains. The South substantially outperformed the Central district and the nation at large with respect to all three performance indicators. However, contrary to the literature, we find that these particular state policies provided no substantial growth advantages, there or elsewhere. Rather, the dominant force behind Russia's agricultural growth has been informal technical change.     

Impact of de-coupling agricultural support on dairy investment and milk production volume in Finland

This study analyses the impacts of de-coupling of agricultural support from production in Finland. A dynamic agricultural sector model, which includes 17 production regions and endogenous investments and technical change, is used in the analysis. Investment in different production techniques is dependent on the relative profitability and the spread of each technique in the population of heterogeneous farms. There are relatively few large farms which use efficient production techniques in Finland. De-coupling weakens the incentive for investment in dairy production and causes a temporary but significant slow down in dairy investments and technical change. Consequently, de-coupling is likely to result in a significant drop in milk and beef production in the next 10-20 year period if no corrective measures are taken in agricultural policy in less-favoured areas such as Finland. However, a slow recovery of investment and output levels are expected in the long run.     

采运生产力水平与科技发展及应用关系研究

通过对中外森林采运生产技术的对比 ,了解我国生产技术指标现状及差距所在 ,分析科技进步与采运生产技术指标之间的关系 ,阐述我国采运技术落后的关键所在 ,针对今后如何发展我国采运科技 ,提高采运生产技术指标提出看法和设想     

Pollution abatement and productivity performance of regional Canadian pulp and paper industries

The performance of pulp and paper industries in four Canadian regions is compared based on the estimation of an input distance function, with and without pollutant outputs. Distance functions are techniques for the representation and estimation of multiple-output and multiple-input production technologies. They are quantity-based techniques. Non-marketed outputs such as pollutants can be easily incorporated into productivity analysis with the help of distance functions. This environmentally sensitive approach provides higher productivity growth estimates for all regions, indicating the need for adjusting conventional measures that ignore the non-marketed benefits of pollution abatement activities. The results also consistently indicate the presence of substantial differences in the regional levels of technical efficiency. Regional industries have not enjoyed similar rates of technological progress due to differences in their underlying structures. Productivity growth estimates for most regional industries remain weak or negative even after the recognition of pollution abatement efforts. Estimates of regional level costs of abatement for biological oxygen demand (BOD) and suspended solids (TSS) are provided.     

Biodiversity Conservation and Productivity in Intensive Agricultural Systems

This paper explores the economic effects of biodiversity loss on marketable agricultural output for intensive agricultural systems, which require an increasing level of artificial capital inputs. A theoretical bio‐economic model is used to derive a hypothesis about the effect of the state of biodiversity on the optimal crop output both in the longer run and in the transitional path towards the steady‐state equilibrium. The hypothesised positive relationship between biodiversity stock and optimal levels of crop output is empirically tested using a stochastic production frontier approach, based on data from a panel of UK specialised cereal farms for the period 1989–2000. The results support the theoretical hypothesis. Increases in biodiversity can lead to a continual outward shift in the output frontier (although at a decreasing rate), controlling for the relevant set of labour and capital inputs. Agricultural transition towards biodiversity conservation may be consistent with an increase in crop output in already biodiversity‐poor modern agricultural landscapes.     

Six Decades of Total Factor Productivity Change and Sources of Growth in Bangladesh Agriculture (1948–2008)

This study applies the Färe–Primont index to calculate total factor productivity (TFP) indices for agriculture in 17 regions of Bangladesh covering a 61‐year period (1948–2008). It decomposes the TFP index into six finer components (technical change, technical‐, scale‐ and mix‐efficiency changes, residual scale‐ and residual mix‐efficiency changes). Results reveal that TFP grew at an average rate of 0.57% p.a. led by the Chittagong, Rajshahi, Rangpur, Dinajpur and Noakhali regions. TFP growth is largely powered by technological progress estimated at 0.74% p.a. Technical efficiency improvement is negligible (0.01% p.a.) due to stagnant efficiency in most of the regions. Decline in scale efficiency is also negligible (0.01% p.a.), but the decline in mix efficiency is high at 0.19% p.a. Decomposition of the components of TFP changes into finer measures of efficiency corrects the existing literature’s blame of a decline in technical efficiency as the main cause of poor TFP growth in Bangladesh. Among the sources, farm size, R&D investment, extension expenditure and crop specialisation positively influenced TFP growth, whereas the literacy rate had a negative influence on growth. Policy implications include encouraging investment in R&D and extension, land reform measures to increase average farm size, promotion of Green Revolution technology and crop diversification.     

Where to implement local biotech innovations? A framework for multi-scale socio-economic and environmental impact assessment of Green Bio-Refineries

Green Bio-Refineries (GBRs) have economic and environmental potentials through changing land use from cereals to grass production and provision of grass-based protein feed for livestock production and other valuable byproducts. However, the potentials are dependent on local conditions of the GBRs, such as land productivity, environmental sensitivity and transport distances for feedstock as well as the regional economy which GBRs are a part of. In this paper, we compare the total (direct, indirect and induced) effects of different location choices of GBRs in Denmark at different (municipal, regional, national) scales − a key step for decisions about development of GBRs from both investors' and authorities' perspectives. We integrate a local life-cycle assessment (LCA), a geographic information system (GIS) analysis and an economic-environmental input-output (EEIO) based model (LINE) into a common framework (GIS-LCA-EEIO). We show that locating GBRs in Western Denmark, where the soils are primarily sandy and livestock densities are high, generates higher socio-economic gains than in Eastern Denmark, where the soils are primarily loamy and the concentrations of livestock are lower. We conclude by sketching out priority areas for developing GBRs and discuss the policy implications of the results within the context of development of a bio-based economy.