Agriculture and Productivity of Labor in Europe

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Periklis
Dr. Periklis Gogas
, Associate Professor, Department of International Economics, Democritus University of Thrace, Greece.

Agrapetidou

Ms. Anna Agrapetidou, PhD candidate, Economics, Democritus University of Thrace, Greece

The third column of the Table below, reports the percentage of the labor force employed in agriculture; in the fourth column we present the GDP share of agriculture for each country. Finally, in the last column we produce a Balassa-like revealed productivity index by dividing the share of agriculture in the GDP by the share of agriculture in total employment (column four divided by column three). Thus, the last column provides a comparable measure of the revealed productivity of the agricultural sector in Europe. It measures for each country, the share of GDP produced by a 1% employment in the agricultural sector.

As one can see, there are striking differences in the productivity of labor in agriculture within Europe. Malta, Denmark and Norway are of the three most productive countries while Greece, Portugal and Montenegro are at the bottom of this list. It is interesting that many northern countries appear to be the most productive in agriculture, despite the adverse weather conditions. One explanation of this interesting fact may be that these countries in order to overcome the adverse weather conditions have invested heavily in technology and equipment. Thus, they are able to produce more using a fraction of the labor needed in the south.

TABLE

A/A Country Employment in agriculture % Agriculture sector as % of GDP Relative productivity
1 Malta 1 1.9 190%
2 Denmark 3 4.5 150%
3 Norway 2 2.6 130%
4 Iceland 6 5.4 90%
5 Netherlands 3 2.7 90%
6 Sweden 2 1.8 90%
7 Bulgaria 6 5.2 87%
8 Spain 4 3.2 80%
9 Cyprus 3 2.4 80%
10 Finland 4 3.0 75%
11 Hungary 5 3.7 74%
12 Belgium 1 0.7 70%
13 ?stonia 5 3.5 70%
14 United Kingdom 1 0.7 70%
15 France 3 1.8 60%
16 Ukraine 17 9.4 55%
17 Czech Rep. 3 1.6 53%
18 Serbia 21 11.2 53%
19 Italy 4 2.0 50%
20 Latvia 8 4.0 50%
21 Albania 42 20.7 49%
22 Germany 2 0.8 40%
23 Luxembourg 1 0.4 40%
24 Ireland 5 2.0 40%
25 Turkey 24 9.3 39%
26 Croatia 14 5.4 39%
27 Lithuania 9 3.3 37%
28 Switzerland 4 1.3 33%
29 Slovenia 8 2.5 31%
30 Austria 5 1.5 30%
31 Romania 29 7.9 27%
32 Poland 13 3.4 26%
33 Greece 13 3.3 25%
34 Portugal 11 2.5 23%
35 Montenegro 6 0.8 13%

Source: World Bank and CIA World Factbook

 

3 thoughts on “Agriculture and Productivity of Labor in Europe”

  1. I think the most appropriate name for the last column is % production per capita and not productivity…Productivity (labor) is the ratio of output (production) to inputs used in the production process and it’s rather a microeconomic indicator than macroeconomic

    1. It follows Balassa’s revealed comparative advantage principle. It is not actually a per capita measure. It is per % of labor involved in agriculture. Thus, two countries with the same agricultural production, the same population but different agriculture labor shares will have a different index. Althought I do not understant why the macro/micro label matters but sectoral productivity is certainly a macro issue.

      1. According to the international bibliography, Productivity is the ratio of output (production) to inputs used in the production process in the level of a company (micro) and not the ratio of %GDP to %Labor in the level of countries (macro). Balassa’s comparative advantage uses Exports – trade flows (part of GDP) to calculate the advantage/disadvantage of a country in a specific sector.

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