Does entrepreneurial activity matter for economic growth in developing countries? The role of the institutional environment

The discussion on which institutions determine entrepreneurial activity – and the role of institutions in the aggregated output for developing countries – is as yet unresolved. The extant literature about entrepreneurship recognizes new ventures as potential mechanisms for long-term development. Yet, there is a consensus on the lack of evidence, particularly for these countries. Drawing on institutional economics, this article explores the interrelationships among institutional environment, entrepreneurial activity, and economic growth. To this end, we use simultaneous-equation panel data models for a sample of 14 developing countries (78 observations) over the period of 2004–2012. The main findings suggest a causal chain running from institutions to opportunity entrepreneurship, which is linked to the economic growth of emerging economies. In particular, we find that institutional factors – such as the number of procedures to start a new business, private credit coverage ,, and access to communication– influence entrepreneurial activity driven by opportunity. Policy implications for developing countries could be derived in order to enhance their economic performance through entrepreneurial activity.

     

Revisiting the decomposition of cost efficiency for non-homothetic technologies: a directional distance function approach

In the early 1980’s Kopp and Diewert proposed a popular method to decompose cost efficiency into allocative and technical efficiency for parametric functional forms based on the radial approach initiated by Farrell. We show that, relying on recently proposed homogeneity and duality results, their approach is unnecessary for self-dual homothetic production functions, while it is inconsistent in the non-homothetic case. By stressing that for homothetic technologies the radial distance function can be correctly interpreted as a technical efficiency measure, since allocative efficiency is independent of the output level and radial input reductions leave it unchanged, we contend that for non-homothetic technologies this is not the case because optimal input demands depend on the output targeted by the firm, as does the inequality between marginal rates of substitution and market prices—allocative inefficiency. We demonstrate that a correct definition of technical efficiency corresponds to the directional distance function because its flexibility ensures that allocative efficiency is kept unchanged through movements in the input production possibility set when solving technical inefficiency, and therefore the associated cost reductions can be solely—and rightly—ascribed to technical-engineering-improvements. The new methodology allowing for a consistent decomposition of cost inefficiency is illustrated resorting to simple examples of non-homothetic production functions.     

Dynamics of Harvest Subcontracting: The Roles Played by Labour Contractors

A historical perspective of three export agro‐industries in Argentina (lemons, sweet citrus and tobacco) illustrates the range of factors that may foster subcontracting and the choice of subcontracting modalities. The case studies also illustrate that subcontracting is often a fragile strategy that leads to the eventual reabsorption of subcontracted tasks. We argue that the fragility of subcontracting the harvest rests on the inability of producers and labour contractors to negotiate a relationship that favours collaboration and problem solving. This failure is at the root of the high transaction costs of harvest subcontracting that force producers to resort to ancillary investments or sanctions, or to reabsorb some or all of the delegated tasks. A mismatch of resources and technical competence between producers and harvest labour contractors also contributes to inadequate performance of services. It is thus not surprising that harvest labour contractors are not always permanent fixtures; they may appear, disappear and reappear, particularly in fresh fruit export industries.     

Un análisis de la gestión por competencias en la empresa española De la teoría a la práctica

This paper is about the competency management, a technique for human resources management aimed at improving the performance of employees and organization performance. Specifically, there are concerns about the high degree of implementation of this technique and its relationship with management performance in specific industries with various economic outcomes.     

A note on “A directional slacks-based measure of technical inefficiency”

In this note we show, by means of several examples, that a directional distance function model cannot be matched with an additive model. Specifically, we show the difference between the directional slacks-based measure and the corresponding directional distance function.     

Families of linear efficiency programs based on Debreu’s loss function

Gerard Debreu introduced a well known radial efficiency measure which he called a ??coefficient of resource utilization.?? He derived this scalar from a much less well known ??dead loss?? function that characterizes the monetary value sacrificed to inefficiency, and which is to be minimized subject to a normalization condition. We use Debreu??s loss function, together with a variety of normalization conditions, to generate several popular families of linear efficiency programs. Our methodology also can be employed to generate entirely new families of linear efficiency programs.     

BAM: a bounded adjusted measure of efficiency for use with bounded additive models

A decade ago the Range Adjusted Measure (RAM) was introduced for use with Additive Models. The empirical experience gained since then recommends developing a new measure with similar characteristics but with more discriminatory power. This task is accomplished in this paper by introducing the Bounded Adjusted Measure (BAM) in connection with a new family of Data Envelopment Analysis (DEA) additive models that incorporate lower bounds for inputs and upper bounds for outputs while accepting any returns to scale imposed on the production technology.     

The political economy of multidimensional child poverty measurement: a comparative analysis of Mexico and Uganda

ABSTRACT

As part of the 2030 Agenda, much effort has been exerted in comparing multidimensional child poverty measures both technically and conceptually. Yet, few countries have adopted and used any of these measures in policymaking. This paper explores the reasons for this absence from a political economy perspective. It develops an innovative political economy framework for poverty measurement and a hypothesis whereby a country will only produce and use reliable and sustainable multidimensional child poverty (MDCP) measures if and only if three conditions coalesce: consensus, capacity and polity. We explore this framework with two relevant case studies, Mexico and Uganda. Both countries satisfy the capacity condition required to measure MDCP but only Mexico satisfies the other two conditions. Our proposed political economy framework is normatively relevant because it identifies the conditions that need to change across multiple contexts before the effective adoption and use of an MDCP measure becomes more likely.