An Index Theory Based Approach to Measuring the Environmentally Sustainable Productivity Performance of Agriculture

Kelly Cobourn, Christopher O'Donnell, Jesús Antón and Ben Henderson

No 213, OECD Food, Agriculture and Fisheries Papers from OECD Publishing

Abstract: This paper proposes an analytical framework to calculate an environmentally sustainable productivity index (ESPI) to address the multiple challenges faced at present by food systems. Using this framework, an empirical analysis covering 28 countries (anonymised) over three decades examines sustainable productivity performance including three environmental externalities: greenhouse gas emissions, and nitrogen and phosphorus surpluses. The results illustrate how the framework could be used to identify trends in environmentally sustainable productivity within and across countries. While this framework is flexible and can accommodate multiple environmental variables, its application requires appropriate and comparable data on agriculture production and related environmental performance, selecting methods to measure and aggregate groups of outputs and inputs into the productivity index, and choosing a weight for environmental externalities relative to commodity outputs. Sensitivity analyses, as well as comparisons with other approaches to measure sustainable productivity can be undertaken using this framework to ensure the robustness of the measurement. By supporting cross-section comparisons, the ESPI also has the potential to be used in statistical analysis to identify the economic and policy drivers of sustainable productivity performance.

Keywords: Environmental sustainability; Index theory; Total Factor Productivity (search for similar items in EconPapers)
JEL-codes: C43 D24 O44 Q18 (search for similar items in EconPapers)
Date: 2024-10-23
New Economics Papers: this item is included in nep-agr, nep-eff and nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:oec:agraaa:213-en

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