Aggregate factor input and productivity in agriculture: A comparison for the EC-member countries, 1963–76

Abstract

A description is given in this article of the development of total production, aggregate factor input and total factor productivity within the agricultural sector of the EC-member countries. The first part contains a comparative analysis of various input capacities and their time profiles. Comparability of data base and methodology is emphasized. Individual factor components (labour, machinery and buildings, land and variable inputs) are then aggregated by using a Divisia-chain index with variable weights. A similar aggregation is performed for total production and finally an international comparison of the index of total factor productivity is presented. The results indicate that both the rates of change and the time profiles of the total factor input have been very different in the various countries. Moreover, the differences in factor productivities have grown. Countries, which had already reached a comparatively high level of factor productivity, have also had the highest growth rates of the productivity index. The growth rate of the agricultural total productivity within the EC-9 has slightly increased, by an average 1.8% between 1963 and 1976. Although the capacity of the total factor input has increased in some countries, it has shrunk in others, namely in Germany, Great Britain and Denmark. On average, within the EC-9, the decline of labour and land inputs has been compensated by the increased use of variable inputs and capital. Hence, the total factor input in the agricultural sector of the EC-9 has remained fairly constant, so that the growth rates of agricultural production and productivity have been at the same average rate of 2% per year.