Analysis of Environmental Total Factor Productivity Evolution in European Agricultural Sector

Productivity analysis has been an important avenue for economic research. Therefore, medleys of quantitative techniques have been proposed to operationalize productivity analysis. In this article, an extended by-production model is discussed and applied to ensure a link between the production and the pollution-generating subtechnologies. The corresponding dual formulations are provided to interpret the economic role of pollution-generating inputs in the subtechnologies. Finally, we integrate the proposed model with the environmental Luenberger-Hicks-Moorsteen productivity indicator based upon input and output directional distance functions. The proposed model is applied to measure the green economic growth of agricultural sectors of the selected European countries.