Innovation Seminar Series

Productivity Growth in the Crop and Livestock Sectors in the Prairie Provinces

Presented by Lana Awada, Postdoctorate Fellow, Department of Bioresource Policy, Business & Economics

Abstract

Over the period 1990-2004, agricultural productivity on the Prairies declined by 0.35% per annum. Given the enduring challenges of natural resource scarcity, faltering productivity growth increases the challenges of closing the gap between the supply of agricultural products and the demand for food, and leads to higher food prices and to increased environmental stress.


The study measures both Prairie long-term productivity trends over the period 1941-2012, and recent productivity trends over the periods 1990-2012 and 2000-2012. Productivity indexes are measured at the provincial level. For each of the Prairie Provinces, estimates of output, input, and total factor productivity (TFP) indexes are provided for the crop and livestock sectors. The results show that Prairie agriculture displayed relatively strong overall productivity growth over the 12 year period to 2012. Prairie productivity increased by 3.2% per annum over the period 2000-2012. Of particular significance is the large increase in the crop sector productivity.


This study also estimates the impacts of using alternative assumptions regarding the treatment of the rate of return when constructing measures of capital service flows on capital input and TFP growth estimates. The comparison revealed a host of differences in measures, indicating that the choice of the rate of return has a large influence on the estimates of capital input and TFP growth.

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