CONVERGENCE OF FOODGRAINS PRODUCTIVITY IN INDIAN AGRICULTURE

Abstract

This study investigates the convergence hypothesis in productivity of foodgrains in terms of output per unit of cropped area during the period 2000-01 to 2012-13 across the major 18 foodgrains producing states of India using the two standard measures of convergence viz., sigma convergence and beta convergence. This has been done by applying the advanced panel data methodology, namely, panel unit root tests on demeaned series, static panel regression and dynamic panel regression apart from conventional measures based on standard deviation and coefficient of variation. A cross section regression shows irrigated cropped area to be the only significant explanatory variable for explaining productivity variation across the states. All the tests show evidence in favour of sigma and both conditional and unconditional beta convergences. This study with foodgrains productivity shows convergence or divergence in outcome(s) only. But convergence in means ( i.e., sources) is also an important issue in this context. In this paper, we have also examined this in terms of input cost for two principal crops viz., paddy and wheat in the major foodgrains producing states. This has been studied by sigma convergence technique only. Results show convergence in average cost of production of wheat only, and not of paddy. This finding is important in explaining the role of technological spillover on input cost reduction across the states, and its effect in achieving convergence in foodgrains productivity.

Keywords

• Productivity
• Sigma Convergence
• Beta Convergence
• Panel Unit Root
• Technical Spill Over