--- canonical_url: "https://csls.ca/ipm-archive/ipm-issue-27/on-productivity-the-influence-of-natural-resource-inputs/" title: "On Productivity: The Influence of Natural Resource Inputs" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-13T07:37:57+00:00" date_modified: "2026-07-13T07:37:57+00:00" post_type: "ipm" summary: "" ipm_issue_period: - "Fall 2014" ipm_keyword: - "agriculture" - "Australia" - "KLEMS" - "MFP" - "mineral deposits" - "mining" - "natural resources" - "production function" - "rainfall" - "utilities" ipm_research_theme: - "Measurement and methodology" ipm_country_focus: - "Australia" - "Canada" - "International" featured_image: "https://csls.ca/wp-content/uploads/2026/06/IPM_50_banner.webp" status: "publish" --- # On Productivity: The Influence of Natural Resource Inputs Canonical URL: https://csls.ca/ipm-archive/ipm-issue-27/on-productivity-the-influence-of-natural-resource-inputs/ # On Productivity: The Influence of Natural Resource Inputs [Download full PDF article](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-27-8-Topp-Kulys.pdf) Cite this article × Cite this article as: Topp, Vernon, and Tony Kulys. 2014. “On Productivity: The Influence of Natural Resource Inputs.” International Productivity Monitor, No. 27 (Fall 2014): 64–78. https://www.csls.ca/ipm-archive/ipm-issue-27/on-productivity-the-influence-of-natural-resource-inputs/ ## Authors: - Vernon Topp Australian Productivity Commission - Tony Kulys Australian Productivity Commission ## IPM Issue 27 Fall 2014 pp. 64–78 ## Related IPM articles [Using Ecosystem Accounting to Integrate the Environment in Measures of Multifactor Productivity Carl Obst Fall 2024 | IPM Issue 47 | pp. 87–108](https://csls.ca/ipm-archive/ipm-issue-47/using-ecosystem-accounting-to-integrate-the-environment-in-measures-of-multifactor-productivity/) [Eroding Natural Capital: An Alternative Explanation for the Secular Decline in Productivity Growth Christina Caron Fall 2024 | IPM Issue 47 | pp. 109–147](https://csls.ca/ipm-archive/ipm-issue-47/eroding-natural-capital-an-alternative-explanation-for-the-secular-decline-in-productivity-growth/) [Climate Change and Productivity — An Exploration Dirk Pilat Fall 2024 | IPM Issue 47 | pp. 54–86](https://csls.ca/ipm-archive/ipm-issue-47/climate-change-and-productivity-an-exploration/) [Measuring Productivity: The Response of National Statistical Institutes to the OECD’s Productivity and Capital Manuals Nicholas Oulton Fall 2023 | IPM Issue 45 | pp. 200–225](https://csls.ca/ipm-archive/ipm-issue-45/measuring-productivity-the-response-of-national-statistical-institutes-to-the-oecds-productivity-and-capital-manuals/) [Capacity Utilization and Production Function Estimation: Implications for Productivity Analysis Jianmin Tang, Weimin Wang Fall 2023 | IPM Issue 45 | pp. 178–199](https://csls.ca/ipm-archive/ipm-issue-45/capacity-utilization-and-production-function-estimation-implications-for-productivity-analysis/) [Measuring Capital and Multifactor Productivity: The Role of Asset Depreciation and Initial Capital Stock Estimates Pierre-Alain Pionnier, Belén Zinni, Kéa Baret Fall 2023 | IPM Issue 45 | pp. 155–199](https://csls.ca/ipm-archive/ipm-issue-45/measuring-capital-and-multifactor-productivity-the-role-of-asset-depreciation-and-initial-capital-stock-estimates/) [Decomposing Canada’s Post-2000 Productivity Performance and Pandemic-Era Productivity Slowdown Chris Haun, Tim Sargent Fall 2023 | IPM Issue 45 | pp. 5–27](https://csls.ca/ipm-archive/ipm-issue-45/decomposing-canadas-post-2000-productivity-performance-and-pandemic-era-productivity-slowdown/) [Capital Measurement and Productivity Growth Across International Databases Reitze Gouma, Robert Inklaar Spring 2023 | IPM Issue 44 | pp. 67–88](https://csls.ca/ipm-archive/ipm-issue-44/capital-measurement-and-productivity-growth-across-international-databases/) [The Rise of Pro-Productivity Institutions: A Review of Recent Developments Dirk Pilat Spring 2023 | IPM Issue 44 | pp. 3–33](https://csls.ca/ipm-archive/ipm-issue-44/the-rise-of-pro-productivity-institutions-a-review-of-recent-developments/) [R&D and Productivity Jianmin Tang, Weimin Wang Fall 2019 | IPM Issue 37 | pp. 120–143](https://csls.ca/ipm-archive/ipm-issue-37/rd-and-productivity/) ## Abstract ## Résumé EN FR Copy link Email LinkedIn The production function underlying standard estimates of multifactor productivity (MFP) typically restricts the list of explicitly measured inputs to capital, labour and intermediate inputs (energy, materials and services). These inputs are measured in the national accounts, and in most industries are the most important or significant inputs to production. All other influences on output are captured by the MFP ‘residual.’ However in some industries – mining, agriculture, and utilities – output can also depend significantly on unmeasured inputs of natural resources. Rainfall in agriculture is an obvious example, but so too is the issue of mineral resource deposits in the mining sector, particularly where mining is a mature industry and the richest and most accessible deposits have already been developed. In this article we attribute a substantial part of recent large negative changes in MFP growth in the mining, agriculture and utilities industries in Australia to unmeasured natural resource input changes. As MFP growth estimates derived from the application of the usual production function are generally interpreted as measuring improvements in the ‘technology’ used to convert standard inputs into output, where there are significant changes in natural resource dependent industries this interpretation of MFP needs to be adjusted. M ULTIFACTOR PRODUCTIVITY (MFP), which La fonction de production sous-jacente aux estimations standard de la productivité multifactorielle (PMF) limite généralement la liste des intrants explicitement mesurés au capital, à la main-d’œuvre et aux intrants intermédiaires (énergie, matériaux et services). Dans certaines industries — l’extraction minière, l’agriculture et les services publics — la production peut également dépendre de façon significative d’intrants en ressources naturelles non mesurés. Les précipitations dans l’agriculture en sont un exemple évident, mais il en va de même pour les gisements de ressources minérales dans le secteur minier, en particulier dans les mines matures où les gisements les plus riches et les plus accessibles ont déjà été exploités. Dans cet article, nous attribuons une part substantielle des récentes variations négatives importantes de la PMF en Australie à ces intrants en ressources naturelles non mesurés. [Download full PDF](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-27-8-Topp-Kulys.pdf)