Total factor productivity (TFP) in the agricultural sector and public policies: A comparative analysis of Turkey and the Netherlands with the malmquist TFP index (1961–2021)

The aim of this study is to analyze the total factor productivity (TFP) of the agricultural sectors in Türkiye and the Netherlands from 1961 to 2021 using the Malmquist TFP Index and to evaluate the long-term impact of public policies on TFP. The study employs Data Envelopment Analysis (DEA) to calculate the Malmquist Total Factor Productivity (MTFP) Index, measuring technical efficiency change (TEC), technological change (TC), and cumulative MTFP changes under constant (CRS) and variable returns to scale (VRS) assumptions, using both input-oriented and output-oriented approaches. Agricultural production, land, labor, and capital data for the 1961-2021 period were sourced from the USDA-ERS. The findings on TEC, TC, and MTFP index values for Türkiye and the Netherlands highlight the structural differences in the agricultural sectors of the two countries. The Netherlands consistently outperformed Türkiye in TEC across both input- and output-oriented CRS and VRS measurements, with TEC values generally exceeding 1, indicating sustained agricultural production through enhanced technical efficiency. Türkiye, however, experienced a slight decline in TEC (0.991) in input-oriented CRS measurements but showed improvement (TEC 1.011) in output-oriented analysis. Regarding TC, the Netherlands exhibited higher values than Türkiye in both input- and output-oriented measurements, with an input-oriented TC value of 1.017 compared to Türkiye's 1.007, suggesting faster adoption of technological innovations in the Netherlands. Although Türkiye achieved technological progress with TC values close to 1, this progress was more limited compared to the Netherlands. The MTFP index values for the Netherlands were generally higher than those for Türkiye, reflecting more sustainable performance in both TEC and TC. Türkiye showed relative improvement in the output-oriented MTFP index (1.004) but could not match the Netherlands' overall performance. Cumulative MTFP analyses indicate consistent productivity growth in the Netherlands, while Türkiye experienced unstable and limited progress. Structural issues in Türkiye, such as fragmented land structures, small-scale family farms, low R&D investments, inadequate agricultural education, limited adoption of innovative technologies, and inconsistent policies, constrain TFP growth. While Türkiye's subsidy-focused public policies led to periodic TFP increases, they failed to ensure sustained growth. In contrast, the Netherlands' TFP growth is driven by R&D-focused policies, precision agriculture technologies, CAP reforms, institutionalization, and an effective agricultural education model. By fulfilling a significant gap in the literature through long-term analyses, this study provides a scientific perspective for developing strategic policy recommendations.