November 2000 The introduction of green revolution technologies in wheat and rice production in Pakistan's Punjab province reversed the country's food crisis and stimulated rapid agricultural and economic growth. But resource degradation through intensification, monocropping, and mismanagement of water resources has offset much of the productivity effect of technological change. The introduction of green revolution technologies in wheat and rice production in Asia in the mid-1960s reversed the food crisis and stimulated rapid agricultural and economic growth. But the sustain-ability of this intensification strategy is being questioned in light of the heavy use of external inputs and growing evidence of a slowdown in productivity growth and degradation of the resource base. Ali and Byerlee address the critical issue of long-term productivity and the sustainability of Pakistan's irrigated agriculture. To estimate changes in total factor productivity in four production systems of Punjab province, they assemble district-level data on 33 crops, 8 livestock products, and 17 input categories. They find that average annual growth in total factor productivity was moderately high (1.26 percent) for both crops and livestock for the period 1966-94, but observe wide variation in productivity growth by cropping system. A second, disaggregated data set on soil and water quality reveals significant resource degradation. The authors use the two data sets to decompose the effects of technical change and resource degradation through application of a cost function. They find that continuous and widespread resource degradation (as measured by soil and water quality variables) has had a significant negative effect on productivity, especially in the wheat-rice system, where resource degradation has more than offset the productivity effects of technological change. Degradation of the health of the agro-ecosystem was related in part to modern technologies, monocropping, and mismanagement of water resources. The results call for urgent analysis of technology and policy options to arrest the degradation of resources. This paper--a joint product of the Rural Development Department and the Asian Vegetable Research and Development Center--is part of a larger effort to support the development of sustainable intensification of irrigated agricultural systems. The study was funded by the Bank's Research Support Budget under the research project "Total Factor Productivity Growth in Post-Green Revolution Agriculture of Pakistan and Northwest India." Mubarik Ali may be contacted at [email protected].