The figure below is the empirical counterpart to Figure 1 (in Documentation and Methods)—it decomposes global agricultural growth (measured by the height of the bars, in average annual percent growth) into growth due to land and irrigation expansion, input intensification, and TFP. The chart shows that output growth was slowing in the 1970s and 1980s but then accelerated in the 1990s and 2000s. In the latest period (2001-14), global output of total crop and livestock commodities was expanding at an average rate of 2.54 percent per year.
TFP has replaced resource intensification as the primary source of growth in world agriculture
The different colors of the bars show how much of this growth came from bringing new resources into production (new land, extension of irrigation, and input intensification per acre) and how much came about by raising the TFP of these resources. In the decades prior to 1990, most output growth came about from intensification of input use (i.e., using more labor, capital, and material inputs per acre of agricultural land). Bringing new land into agriculture production and extending irrigation to existing agricultural land were also important sources of growth. Over the last two decades, however, the rate of growth in agricultural resources (land, labor, capital, etc.) has significantly slowed. What has allowed agricultural output to continue to grow despite this slowdown in agricultural resources is productivity—getting more output from existing resources. During 2001-14, improvements in TFP accounted for about two-thirds of the total growth in agricultural output worldwide. TFP growth reflects the use of new technology, efficiency improvement, and changes in management by agricultural producers around the world.
Productivity is the prime driver of agricultural growth in all global regions except Sub-Saharan Africa
|Global region||Agricultural output||Total factor productivity||All inputs||Land||Labor||Machinery capital||Livestock capital||Fertilizers||Animal feed|
Asia (except W. Asia)
West Asia and North Africa
|*Average annual change over 2001-14 (percent per year).
Source: USDA, Economic Research Service, International Agricultural Productivity data product, as of October 2017.
While productivity has been the major source of agricultural growth in developed countries for at least the past half-century, the acceleration of global TFP growth since 1990 came about because of improved productivity performance in developing countries and, to some extent, in the transition economies of the former Soviet Union and Eastern Europe. The map below shows annual average agricultural TFP growth rates by country since 1971. Agricultural TFP grew most rapidly in the dark-colored countries, and most slowly (or not at all) in the yellow-colored countries. Strengthening the capacity of national agricultural research and extension systems in developing countries has been a key determinant of agricultural productivity growth (Evenson and Fuglie, 2010). Long-term investments in agricultural research were especially important to sustaining higher agricultural TFP growth rates in large, rapidly developing countries such as Brazil (Rada and Valdes, 2012) and India (Rada and Schimmelpfennig, 2015). Chinese agricultural benefited enormously from institutional and economic reforms as well as technological changes resulting from investments in research (Fan, 1991; Lin, 1992; Jin et al., 2002). Under-investment in agricultural research remains an important barrier to stimulating agricultural productivity growth in Sub-Saharan Africa (Fuglie and Rada, 2013).
Another view of agricultural output and productivity performance in given in the figure below. The indices show the growth in agricultural output, input and TFP levels since 2001 for groups of countries aggregated by income class, according to World Bank definitions in 2015. Agricultural output has been growing fastest in low and middle income countries, where food demand is also growing rapidly. In low income countries (many of which are in Sub-Saharan Africa), agricultural growth is primarily resource-based, rather than productivity-based. In high income countries, where population and food demand is growing relatively slowly, TFP growth in agricultural has allowed land, labor, and other resources to be withdrawn from agriculture for other uses, while still meeting domestic food demand. Transition countries (former Soviet Union and eastern Europe) underwent a major economic shock in the 1990s when they began the transition from centrally-planned to market economies. Agriculture production in these countries has not yet recovered from its pre-transition peak.