Using Data Envelopment Analysis to Measure International Agricultural Efficiency and Productivity

Abstract

Numerous methods for measuring multifactor productivity have been used by economists. This report uses a recently developed approach, data envlopment analysis, to measure productivity. This method can be used not only to calculate productivity but also to divide productivity measures into indices that measure technical efficiency and technical change. Technical efficiency measures the efficiency with which resources are used. Technical change measures changes in output arising from improved technology. In this report, relative efficiency measures and multifactor productivity measures are calculated for the agricultural sectors of 77 countries. Analysis shows that multifactor productivity of the agricultural sector has risen in most developed countries and fallen in many developing countries over the past two decades. Adoption of input-intensive technology by developing countries may have offset productivity gains from improved yields and imporved labor productivity,