Inputs use in the agriculture of Emilia-Romagna: farm comparison through the Total Factor Productivity (TFP) index

In order to measure agriculture sustainability, the efficient use of inputs becomes a crucial issue. In this perspective, the analysts concentrate their attention on the total factor productivity index (TFP). In this view, Lynam and Herdt (1989) proposed the TFP as a suitable assessment of the sustainability of single crops, of cropping systems or of farming systems. Even if the TFP does not take into account the non-market output (social and environmental aspects), it is possible to argue that a negative trend of TFP represents a resources’ degradation if related to the generated outputs. On the other hand, the non-negative trend of TFP represents a fitting measure of a sustainable agricultural system and of an efficient use of the resources. The aim of the paper is to analyze the productivity in the use of external factors in different types of farming at the Emilia-Romagna Region level, i.e. specialist field crops, specialist permanent crops and specialist milk production farms. A significant number of indexing procedures is accessible to evaluate the efficiency in converting inputs into outputs. In this paper, the TFP is estimated through an indirect evaluation of quantity index of outputs and inputs of each farming system taken into account in the analysis. Purposely, the amount of the total sales is considered as a measure of the output, whereas labour, capital, external inputs and other intermediate consumption are considered as a measure of the inputs. Data, referred to the period 2000 – 2009, are collected from the farm accountancy data network of the Emilia Romagna Region DG Agriculture. The study highlights how the TFP is a convenient index to evaluate the efficiency in the use of resources. In a broader view, the TFP index trend allows an estimation of economical and social benefits or damages which in the end improves or worsens environmental quality.