Green Total Factor Productivity in Agricultural Development
Summary
Green total factor productivity (GTFP) offers a holistic metric for evaluating agricultural progress by integrating traditional productivity measures with environmental impact. Unlike conventional total factor productivity, GTFP accounts for both desirable outputs, such as crop yields, and undesirable outputs, such as greenhouse gas emissions and nutrient runoff. Advances in measurement techniques—often incorporating non-parametric methods and indices that capture efficiency change and technological progress—have revealed the multifaceted drivers of green productivity growth. Key factors include technological innovation in precision agriculture, adoption of digital and financial tools that enable resource optimisation, policy levers such as environmental regulation, and infrastructure improvements such as mechanisation. Empirical analyses at national and regional scales demonstrate that GTFP gains are sensitive to institutional settings, resource endowments and market access, underlining the need for tailored strategies. Globally, enhancing GTFP contributes to climate-smart agriculture and food security, while offering pathways for rural economic development. Practical applications span precision nutrient management, low-carbon farming techniques and digital finance platforms designed to support sustainable investment in agriculture.
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Green Total Factor Productivity in Agricultural Development publication trend
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Technical terms
Green total factor productivity: A productivity measure that incorporates both desirable outputs and negative environmental externalities from agricultural production.
Malmquist-Luenberger index: An index used to assess productivity change over time, explicitly integrating undesirable outputs alongside conventional outputs.
Slacks-based measure directional distance function: A non-parametric efficiency evaluation method that quantifies excess inputs and shortfalls in outputs, including harmful by-products.
Undesirable output: Any by-product of production that has negative environmental or health impacts, such as CO₂ emissions or nutrient leaching.
Digital inclusive finance: Financial services delivered via digital channels aimed at broadening access to credit, insurance and payment systems for rural and underserved populations.
References
- Spatial-Temporal Characteristics of Agriculture Green Total Factor Productivity in China, 1998–2016: Based on More Sophisticated Calculations of Carbon Emissions. International Journal of Environmental Research and Public Health (2019).
- The Impact of Digital Inclusive Finance on Agricultural Green Total Factor Productivity: Evidence From China. Frontiers in Ecology and Evolution (2022).
- Digital Inclusive Finance, Agricultural Industrial Structure Optimization and Agricultural Green Total Factor Productivity. Sustainability (2022).
- Environmental regulation, agricultural green technology innovation, and agricultural green total factor productivity. Frontiers in Environmental Science (2022).
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