Productivity and Efficiency Change for Agricultural Cooperatives in Japan: The Case of the Dairy-Farming Region in Hokkaido

Abstract

The purpose of this paper is to analyze the productivity change for agricultural cooperatives in Japan measured by nonparametric output-oriented Malmquist indices of total factor productivity (TFP). The productivity change is decomposed into technical change and technical efficiency change. Linear programming techniques are used to calculate the productivity change using a panel data set for 44 agricultural cooperatives located in the dairy-farming region of Hokkaido in Japan over the period 1982-1991. The results suggest that the pattern of TFP changes tends to be driven more by technical progress rather than improvements in technical efficiency. The results also suggest that the goal of a 30% increase in productivity in agricultural cooperatives by the year 2000 introduced at the 20th Annual Meeting of the Agricultural Cooperatives Association of Japan held in 1994 was unattainable in the case of 44 agricultural cooperatives located in the dairy-farming region of Hokkaido.