Improving agricultural productivity continues to be the most efficient way to maintain agricultural output growth, and thus it helps with achieving the United Nation Sustainable Development Goal by 2030 (Ziberman, 2020; van der Brouer, 2020; FAO 2021). Sustainable productivity growth also improves the resilience of agricultural production to external shocks, including resource degradation, climate change and the zoonotic/disease pandemic etc.
Agricultural Total Factor Productivity (TFP) is a widely applied measure of agricultural productivity levels and growth, gauging efficiency and efficacy of production units in farm sectors using multilateral inputs for gross outputs from an economic perspective. It also provides the best currently available means of assessing progress in sustainable agricultural intensification at the national or regional level, if properly adjusted to account for non-market inputs and outputs.
In the literature, there are two broad quality tiers of currently available metrics of agricultural TFP – the first tier meets high international standards for economic productivity accounting like those recommended by the OECD or developed through the KLEMS model (used for developing internationally comparable measures); the second tier provides less refined TFP indexes due to incomplete agricultural statistics (OECD 2021, insights). The first tier is only separately available for a few countries, including the United States, Canada and Australia, while the second tier is dominating in most other countries but distorting the public opinion of agricultural growth and cross-country disparity in reality due to its systematic measurement errors.
While important, a cross-country consistent agricultural TFP measure is not available, because few efforts has been made to construct the consistent agricultural production account across countries. Hence, it is essential for the academic and the government agencies to develop a standard approach and data compilation to construct up-to-date, accurate and internationally comparable TFP indexes for agriculture.