Productivity and its convergence in agriculture in new and old European Union member states

Abstract

This study measures changes in total factor productivity of agriculture for 25 European Union (EU) member states in 2004-2016 using the Färe-Primont index. It also attempts to answer the question whether in the analysed period the levels of total factor productivity in this sector were convergent between member states. To this end, panel unit root tests were used. The study indicates that in new EU member states the level of total factor productivity (TFP) was relatively lower than in most EU-15 states. It was also found that convergence occurred in agricultural productivity almost in all EU member states (except Belgium and the United Kingdom). The research shows that in new EU member states the process of making up differences in the productivity of agriculture was stronger than in old EU member states.

Keywords

• divergence
• färe-primont index
• panel unit root test
• total factor productivity