Measurement of Environmentally Sustainable Growth of Agriculture in Terms of Total Factor Productivity

Abstract

The economic growth has resulted in the depletion of natural resources and degradation of ecosystems. Therefore, the environmentally sustainable growth was accepted as a new model for economy. The idea of environmentally sustainable growth has been widely discussed not only by experts in environmental economics, but also in the international and national policy scene. However, the measurement of environmentally sustainable growth still remains a challenge, especially in agriculture. This article aims to provide an overview of detailed information on adaptation of total factor productivity (TFP) for the measurement of environmentally sustainable growth in agriculture. A method of literature overview was used. Our findings indicate that there are different approaches for performing environmentally sustainable growth measurement in agriculture, and the total factor productivity (TFP) and its modifications are most commonly used indicators in last years. Green TFP growth or similar environmentally related its modifications are measured by growth accounting, data envelopment analysis and stochastic frontier analysis methods.