The sustainable intensification of farming systems: evaluating agricultural productivity, technical and economic efficiency

Abstract

Sustainable Intensification (SI) of agriculture has recently received widespread political attention, in both the UK and internationally. The concept recognises the need to simultaneously raise yields, increase input use efficiency and reduce the negative environmental impacts of farming systems to secure future food production and to sustainably use the limited resources for agriculture. Data Envelopment Analysis (DEA) techniques were used for the investigation of changes in Total Factor Productivity in East Anglia. More specifically, the Malmquist Index and its components (scale, technical and pure efficiency) was used to derive information on productivity over time. Furthermore, the research reported here provides a benchmarking tool to assess water use efficiency, to suggest pathways to improve farm level productivity and to identify best practices for reducing or preventing water pollution. The results of the analysis suggest that the majority of the farms use water resources efficiently both for irrigation and general agricultural purposes, but there is the potential for improvement on some farms. Moreover, the results suggest that farms on the efficiency frontier can provide useful information with regards to operational and managerial changes that can be made to improve the performance of irrigation systems and water productivity. In addition, the analysis of returns to scale provides pathways for long term improvements and planning. The outcome could be used to strategically position a farm in relation to the long term average cost curve and, hence, improve economic efficiency and productivity of the GCFs. In addition, DEA models were used to successfully assign weights to specific environmental pressures that allow the identification of appropriate production technologies for each farm and therefore indicate specific improvements that can be undertaken towards SI. Furthermore, through appropriate econometric modelling this research explored the impacts of various managerial and farm characteristics on the improvement of sustainable intensification. It is concluded that education and advanced managerial skills can increase the environmental awareness of farmers and build knowledge and understanding of the challenges of food production. Moreover, agri-environmental payments can be an effective policy for the reduction of environmental pressures deriving from farming.