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Total factor productivity growth in China’s corn farming: an application of generalized productivity indicator

Total factor productivity (TFP) growth measures usually focus on a certain direction
of optimization and ignore the general setting encompassing the input and output orientations
simultaneously. This paper uses the generalized Luenberger-Hicks-Moorsteen (LHM) TFP indica-
tor which is additively complete and can be decomposed by three mutually exclusive elements. The
input- and output-oriented analysis is undertaken in order to derive the generalized TFP measured.
The paper uses the corn production data from 19 Chinese provinces over the period of 2004–2017.
This research is important as China is the second largest corn producer in the world. The TFP
growth was observed for Chinese corn farming the rate of 0.56% per year. The technological prog-
ress (0.48%) was the major source of the TFP growth, whereas the importance of the technical
efficiency change (0.09%) and scale efficiency change (–0.01%) was negligible.
corn production; total factor productivity; Luenberger-Hicks-Moorsteen indicator;
data envelopment analysis; efficiency change; technological progress.
JEL Classification:
M41, C83, L20

Niu, Z., Zhang, Y., Li, T., Baležentis, T., Štreimikienė, D., & Shen, Z. 2021. Total factor productivity growth in China’s corn farming: an application of generalized productivity indicator. Journal of Business Economics and Management22(5), 1189–1208; https://doi.org/10.3846/jbem.2021.15105; [Science Citation Index Expanded (Web of Science); Social Sciences Citation Index (Web of Science)].


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