ENERGY PRODUCTIVITY OF A PRODUCTION SYSTEM - ANALYSIS AND MEASUREMENT

Energy productivity has not attracted the attention it deserves in com parison to its importance to national economies. Multifactor productiv ity (MFP) and total factor productivity (TFP) are applicable to energy productivity measurement, but aggregation of inputs and segregation o f outputs is a challenge. Concepts for aggregation (using seven differ ent weights) of energy inputs and segregation of output have been deve loped so that ideas of total energy audits, capital and indices can be combined for measurement of energy productivity. A new method of segr egating output based on marginal productivity from econometric estimat es of production functions has been developed to calculate MFP. A case study of the US agricultural production system demonstrates the super iority of this new method of measurement of energy MFP over both TFP a nd the traditional method of measuring MFP. Energy productivity measur ed by using the new method of MFP is responsive to changes in technolo gy and energy situations. Energy productivity of the United States' ag ricultural sector decreased with time until it reached its minimum lev el in 1979. After 1979 it again increased However, capital MFP of US a griculture remained constant over the 36 year interval 1948-83.