Productivity convergence in the European regional agricultures. Determinants of its evolution
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The aim of this study is to analyse the evolution of the European regional agricultural productivity in terms
of convergence. The initial hypothesis is that, in spite of the integration process, the agricultural productivity does not
converge to the same stationary level. Additionally, we try to identify the decisive factors affecting such productivity
growth. Productivity related information comes from Cambridge Econometrics database for a set of 125 EU-15
regions in the period 1985-2004. The methodology used consists in traditional beta convergence regressions. The
difficulties with cross-sectional estimations require the use of panel data techniques for a better estimation of the
speed of convergence. The main results show that convergence occurs to different stationary states and the
productivity growth is related to the loss of agricultural employment and to the levels of investment. Moreover,
subsidies of the Common Agricultural Policy (CAP) do not have so far an important role in the productivity growth.
It seems that the solution to improve agricultural efficiency is not to increase the market support. CAP instruments
should be redefined to stimulate sector investment.