Provincial Total Factor Productivity in Vietnamese Agriculture and Its Determinants

Abstract:This paper was designed to capture the determinants of the agricultural total factor productivity (TFP) level across 60 provinces in Vietnam during the period 1990-2006. The TFP level in Tornqvist form was used to regress on 4 groups of determinants: omitted inputs of agricultural production process; quality of inputs used in agricultural production; technology factors; and output structure. The estimated results showed that: (i) Vietnam’s agricultural sector became relatively more capital intensive; (ii) South provinces were more productive, while North Midlands and Central Coast tended to lag further behind; (iii) labour mobility played a very important role in resources accumulation in agriculture in Vietnam, and so in improving TFP; and (iv) agricultural TFP was significantly influenced by land quality, farm size and land fragmentation.