FIXED FACTOR MODELS OF AGRICULTURAL PRODUCTIVITY GROWTH

Measures of productivity typically assume that all inputs are variable, thus ignoring the quasi-fixed nature of agricultural inputs such as farm machinery, land and structures, and self-employed labour. This paper applies recent developments in productivity growth in the presence of quasi-fixed inputs. We find that adjusting for quasi-fixity reduces observed productivity growth in US agriculture by 19% from 1950 to 1989.