Sense and sustainability revisited: the limits of total factor productivity measures of sustainable agricultural systems

Many economists have advocated and applied total social factor productivity (TSFP) (i.e., total factor productivity estimated with both market and non-market inputs and externalities, and with all factors valued at social prices) as a single all-embracing measure of agricultural sustainability. This paper reviews the conceptual and practical issues in measuring TSFP and shows that no one measure alone will be theoretically or empirically robust as an indicator of sustainability. TSFP is a conceptually flawed measure since inclusion of non-market inputs and outputs and social price-based valuation, in most cases, violates the theoretical basis underlying those estimates. Trends in TSFP also have limited value in diagnosing the nature of sustainability problems, unless changes in productivity are related to underlying changes in technology, human and physical infrastructure, and indicators of resource quality. More attention needs to be given to defining key indicators of agro-ecosystem health and relating these measures to trends in productivity. This analysis must be sufficiently disaggregated and for a long enough time period to allow for spatial and temporal variability inherent in agricultural production. Secondary data at the district level on both conventional inputs and outputs and resource quality have recently allowed more quantitative estimates of sustainability and its causes. With limited data, yield growth decomposition analysis can often be used to provide valuable insights into sustainability problems. Meanwhile, there is a need to invest in long-term experimental and panel surveys offarmers and their fields for key production systems in order to provide long-term data that will allow full productivity accounting, using more formal statistical procedures. Regardless of the approach selected, the findings of this paper strongly suggest a need for economists, agronomists and soil scientists to collaborate in integrating approaches in order to provide more robust and informative measures of sustainability. © 2001 Elsevier Science B.V. All rights reserved.


Issue Date:
2001-12
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/181438
Published in:
Agricultural Economics: The Journal of the International Association of Agricultural Economists, Volume 26, Issue 3
Page range:
227-236
Total Pages:
10




 Record created 2017-04-01, last modified 2017-08-27

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