Estimating Carbon Footprint and Environmentally Adjusted Productivity of Ontario Dairy Farms
Even though the Canadian dairy industry has one of the lowest carbon footprints globally, it still comprises a significant percentage of the total emissions from agriculture. Productivity based on conventional production functions does not account for the socially undesired Greenhouse Gas emitted in dairy farming. Using the input-oriented directional distance function, I estimated the environmentally adjusted efficiency and productivity of Ontario dairy farms from 2000 to 2020. First, I estimated the annual GHG emission from each dairy farm based on the life cycle assessment methodology guidelines suggested by the International Dairy Federation. I found that the carbon footprint for Ontario dairy farms decreased by 14% over the study period. Second, I estimated the standard and environmentally adjusted efficiency and productivity. Productivity growth was decomposed into two sources: efficiency change and technical change. The results indicated that technological change had a higher contribution than efficiency change to overall productivity growth.