How Does Agricultural Mechanization Affect Agricultural Production? A Panel Data Analysis

Abstract

Purpose: This study aims to explain the relationship between agricultural production and mechanization in agriculture in Turkey using annual country data between the 2006 and 2019. Design/Methodology/Approach: 12 regions under NUTS 1 and ARDL test are used for analysis. The number of machines used, labor, income and land are used as variables. Findings: The empirical results reveal that agricultural production has a positive relationship with income, land and machine usage, but negative with labor in the long term. Although the negative impact of labor is an unexpected result, it is asserted that the machines substitute the labor in some studies. Hence, the increase in usage of machines leads to fall in the number of labor and increase the agricultural production. Results also show that the rise in income increases the agricultural production, labor and machine usage as it creates a resource for more inputs, investment and new machines. It also makes agricultural labor more attractive. On the other hand, the agricultural production is also a reason of income because the more agricultural production increases, the more profit and income farmer earn. Another causality result shows that there is an important impact of the rise in the agricultural land on the machine usage. Originality/Value: The literature shows that there is a very limited number of studies, especially empirically, analyzing the mechanization impact on agricultural production in Turkey. Hence, this study aims to fill the gap in this field and explain the relationship between agricultural mechanization and agricultural production clearly.