Abstract: - The article explored labour productivity in agriculture and carried out a comparative analysis of the

achieved level of labour productivity in the countries of the European Union. The efficiency of agricultural

production needs to be measured to improve the productivity, competitiveness, and profitability of farms. The

multifactorial total factor productivity (MFP) of agricultural production evaluates the main and additional

sources of economic growth in the agricultural sector. Based on the analysis of beta convergence, we observe

an increase in total factor productivity (TFP) in Slovakia and the countries of the European Union. Based on the

obtained statistically significant regression analysis models, beta convergence and sigma divergence of the TFP

of the agricultural sector in the EU and Slovakia were identified. Thus, the process of positive convergence was

Key-Words: - agricultural productivity, labour productivity, total factor productivity, sigma-convergence, beta-

Received: November 28, 2022. Revised: August 24, 2023. Accepted: September 9, 2023. Published: September 15, 2023.

The main objectives of the work are to study the

essence of agricultural productivity, a comparative

analysis of the dynamics of the level of labour

productivity, to substantiate the importance of

increasing total agricultural productivity as a key

The countries of the European Union, which is most

agriculture-oriented, have begun to implement

policies to increase agricultural productivity and

implement the goals of the 2030 Agenda for

European Commission, from a long-term

perspective, productivity is the most reliable factor

in increasing competitiveness, [7]. Thanks to

productivity growth, firms (industries, countries)

can more efficiently use and redistribute limited

factors of production for other purposes, which

ensures a high national income, [2].

essential condition for economic development. The

studies, [8], [9], [10], [11], [12], emphasize that the

agricultural productivity. The study, [14], pointed

out that economic development goes hand in hand

with TFP, and can increase only under, conditions

of intensive agricultural expansion. Agricultural

development is essential to economic growth,

leading to the perception of expanding opportunity,

[15]. The analysis of the productivity of production

factors is particularly important as it is a useful

management tool at any economic level, [1].

influence productivity growth:

the amount of output produced in a country,

industry, sector, or farm given a set of resources and

inputs. Productivity can be measured for each

subject separately or for the group, [2].

measures such as output per worker or yield per

hectare may simply be due to increases in the use of

other inputs (capital per worker, fertilizer per

hectare, etc.), that do not reduce costs or reflect

changes in the underlying technology. However, a

1% increase in TFP at fixed is equivalent to a 1%

decrease in the unit cost of production and

represents a real welfare gain to society, [18].

introduction of new technologies, better

event of environmental degradation. TFP analysis is

especially important as it is a useful management

tool at any economic level, [19]. Performance

evaluation creates the basis for continual

improvement, so an accurate analysis of TFP growth

is essential to develop appropriate policies to access

its performance, [26].

of economic growth in the EU agricultural sector.

Growth in agricultural productivity is associated

human capital, innovation, and improvements in

technology. Technical change has been the main

source of productivity growth, not efficiency

change. The agricultural industry uses digital

(information) technologies to create additional

opportunities to increase productivity and diversify

incomes. Multi-product performance metrics can be

used to measure farm productivity growth that

demonstrates the impact of new technologies,

economies of scale, and management practices on

industry and other industries; reduces food prices

and thus increases real incomes, [3], [4].

brought numerous benefits to society. The growing

availability of food has allowed people to overcome

the problems associated with inappropriate levels of

estimate of the coefficient b, which can be

expressed as follows:

TFP is a key indicator of the effective

implementation of the overall objectives of the

CAP. To analyse the dynamics of productivity

changes, the TFP is used, which also evaluates the

European Innovation Partnership for Agricultural

Productivity and Sustainability (EIP-Agri3). Thus,

the TFP indicator is the main factor in the growth of

agricultural production and farm incomes.

countries, where the TFP index was the highest or

equal, obtained a result higher of 109.81%

compared to EU-28. In other countries, where TFP

is lower than the EU-28 average level, this may be

explained by the fact that implementation of

technological progress in these countries not only

requires structural transformations including

optimization of work resources, but also quality

changes, and especially an improvement in farmers’

knowledge and qualifications.

Slovenia (123.6), Hungary (126.3), and Latvia

(123.7) are the four countries with the maximum

total factor productivity and total factor productivity

growth in 2007-2019. Belgium, Latvia, and

Slovenia show a 47.1%, 42.2%, and 40.7 % average

growth in total factor productivity change. It should

be noticed that a productivity increase in the

examined period may be observed in agriculture,

where the examined index reached 108.92 %

(113.19 % without three countries that significantly

differed from the average values) and annual

average growth of 110.53% (118% without three

countries) and was an effect of both production

technology changes and technical efficiency, and

natural conditions. Accordingly, such countries as

in labour productivity. This relationship between

total factor productivity and labour productivity is

confirmed by the high correlation coefficient

influence on the TFP of individual countries we

have estimated a linear regression model for the

studied countries from the agricultural sector. The

regression model describes the dependence between

the total factor productivity and labour productivity

in 2005-2018 years. The coefficient of

inconsistencies between the results of labour

productivity growth and the state of the food market

and farmers' incomes should be washed away.

Despite the positive effects of increased labour

productivity, and therefore agricultural production

and more complete satisfaction of society's needs,

the increase in supply puts downward pressure on

prices. This has a negative impact on farmers'

incomes if they are not balanced by the growing

volume of sold products. Therefore, regulatory

labour productivity in agriculture was in Latvia,

Poland, Croatia, and Romania. That is, in the most

agrarian-oriented countries of Europe, relatively low

labour productivity was to some extent compensated

by favourable natural conditions. At the same time,

rather high rates of their growth prove that probably

fewer positive changes in labour productivity have

taken place in agriculture in most of the other new

EU Member States, notably Estonia, Croatia,

Slovenia, and Malta.

workers in the total number of employees.

labour productivity may be evidence of a certain

exhaustion of the potential for increasing the

volume of agricultural production in the existing

conditions. This reinforces the need to find new

opportunities for increasing labour productivity, not

by reducing the number of people employed in the

labour market, but by intensification and

diversification of production.

between regions are the result of many national and

local factors, including labour market policies and

institutions, as well as innovation and the use of new

technologies. Despite clear progress in labour

productivity, the level of agriculture in the new

Member States is still significantly lower. This

means that convergence processes are taking place

in the field of labour productivity in EU agriculture.

multifactorial task that includes institutional

products, which will open opportunities to increase

the level of real incomes of the personnel of

agricultural enterprises and raise the prestige of

agricultural labour.