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Measuring agricultural total factor productivity in China: pattern and drivers over the period of 1978‐2016
Author(s) -
Sheng Yu,
Tian Xiaohui,
Qiao Weiqing,
Peng Chao
Publication year - 2020
Publication title -
australian journal of agricultural and resource economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.683
H-Index - 49
eISSN - 1467-8489
pISSN - 1364-985X
DOI - 10.1111/1467-8489.12327
Subject(s) - total factor productivity , agriculture , agricultural economics , china , agricultural productivity , economics , productivity , production (economics) , gross output , commodity , index (typography) , slowdown , growth accounting , economic growth , macroeconomics , geography , market economy , archaeology , world wide web , computer science
The Chinese agricultural sector has experienced a substantial increase in total output since dramatic reforms were introduced in 1978. This paper uses the index method to measure agricultural total factor productivity (TFP) for China’s crop and livestock industries, based on the gross output model from 1978 to 2016. We construct production accounts for the industries using input‐output relationships for the 26 main agricultural commodities and commodity groups, which account for over 90 per cent of the total agricultural inputs and outputs. The results show that China’s agricultural TFP grew at a rate of approximately 2.4 per cent a year before 2009, which is comparable to the main OECD countries and is double the world average. TFP growth accounts for approximately 40 per cent of output growth, suggesting that input growth was the main driver of output growth in the past. However, average productivity growth slowed down after 2009 though it has gradually recovered since 2012. The slowdown reflects the emerging challenges to existing farm production practices in Chinese agriculture, suggesting the need for further institutional reform.