Associations between crop diversification, area-based land-allocation efficiency, and structural resilience potential in Madeira Island: a parish-level DEA and machine learning assessment

Abstract This study examines associations between agricultural diversification and specialisation across parish-level agricultural structures in Madeira Island (Portugal). Using data from the 2019 Agricultural Census, the analysis combines data envelopment analysis (DEA) and ordinary least squares (OLS) as the principal empirical tools, complemented by principal component analysis (PCA), exploratory non-linear diagnostics, and cluster analysis. The objective is to assess how crop-allocation patterns are associated with area-based land-allocation efficiency and diversification-based structural resilience potential. Resilience is conceptualised as an ex-ante risk-spreading capacity proxied by crop diversity and balance indicators rather than directly observed outcomes. The results indicate that more specialised parishes, particularly those focused on subtropical fruits and vineyards, tend to exhibit higher land-use intensity and area-based land-allocation efficiency, whereas more diversified parishes display higher crop-share diversity and stronger diversification-based resilience potential as measured by the proxy indicators used in this study. DEA results show that only a limited number of parishes achieve full efficiency, while OLS estimates reveal strong associations between diversification patterns, crop composition, and efficiency differences across parishes. Supplementary non-linear diagnostics broadly confirm these relationships. Family labour is not significantly associated with diversification, suggesting that diversification patterns reflect broader structural characteristics rather than labour constraints alone. Cluster analysis identifies heterogeneous parish-level agricultural profiles, including intermediate configurations combining relatively high efficiency with moderate diversification. The findings reveal systematic associations between crop-allocation structures, area-based land-allocation efficiency, and diversification-based resilience potential as proxied by crop-share diversity and allocation-balance indicators in a small-island farming system. The study contributes to the literature on agricultural diversification, efficiency, and resilience-oriented agricultural policy in structurally constrained island contexts.