Eco-Efficiency of Crop Production in the European Union and Serbia

Abstract

This paper evaluates the eco-efficiency of crop production in the European Union (EU) and the Republic of Serbia for the period 2015–2023, using a stochastic frontier analysis (SFA) model based on panel data. Eco-efficiency was assessed as the ratio of agricultural output to key environmental pressures, with expenditures on fertilizers, plant protection products, and energy serving as proxies for ecological burden. The analysis shows that the average eco-efficiency score (Total EE) across the sample is 59.26%, implying that nearly 41% of inputs could be reduced without decreasing output. Decomposition reveals high residual eco-efficiency (93.62%) and lower persistent eco-efficiency (63.30%), suggesting that systematic inefficiencies dominate and are primarily linked to internal farm-level factors such as management practices, organizational structures, and technology adoption. Serbia’s total eco-efficiency score of 63.0% places it close to the EU average, confirming structural similarities with Southern and Eastern European countries. Eco-efficiency scores exhibit notable cross-country variation, ranging from approximately 35% to 96%. About 59% of countries fall within the 50–75% interval, while roughly 11% exceed 75%, indicating considerable scope for further improvement. Cluster analysis further indicates that while Serbia belongs to the lower-intensity group, it has significant potential to converge toward EU frontrunners through farm-level improvements. The findings highlight the importance of targeting internal determinants of efficiency, while recognizing that policy measures can provide enabling conditions and long-term incentives for the green transition. A coherent policy for the green transition should prioritize farm-level structural upgrades, such as technology adoption, advisory and knowledge transfer, and sustainable nutrient and soil management, supported by enabling CAP instruments (eco-schemes and GAEC) and IPARD measures to accelerate improvements in resource efficiency and environmental performance.