An empirical analysis of TFP gains in the agricultural crop-sub-sector of NWFP using Malmquist Index approach
Kiani, Adiqa Kausar
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This paper investigates the total factor productivity (TFP) performance of NWFP agriculture crop subsector from 1970 to 2004. It identifies the sources of growth of TFP growth and assesses TFP growth changes in agriculture crop sub-sector. Data envelopment analysis (DEA) approach is used to estimate the changes in the production frontier. The Malmquist productivity index has decomposed total factor productivity into technological change (TECHCH) and technical efficiency change (EFFCH). TECHCH implies shifts in the frontier or innovation while EFFCH implies catching up to the frontier. Empirical results suggest that the NWFP crop sector features low productivity growth. Catching up is the main driver for TFP growth.