Productivity and technical change: Measurement and testing

This paper considers two specifications, namely, the time trend (TT) and general index (GI) of technical change. These models are extended to accommodate the TFP growth accounting relationship in to the econometric model. We also propose a formal test to determine whether the TT or the GI model is appropriate for the data. I would like to thank Badi Baltagi for his comments and Peter Schmidt for suggesting the test proposed in the paper. None, other than me, is responsible for any remaining errors.     

Luenberger and Malmquist Productivity Indices: Theoretical Comparisons and Empirical Illustration

This contribution establishes, from a theoretical viewpoint, the relations between the Malmquist productivity indices, that measure in either input or output orientations, and the Luenberger productivity indices, that can simultaneously contract inputs and expand outputs, but that can also measure in either input or output orientations. The main result is that a Malmquist productivity index overestimates productivity changes, since it provides productivity measures that are nearly twice those given by the Luenberger productivity index looking for simultaneous contractions of inputs and expansions of outputs. This relationship is empirically illustrated using data from 20 OECD countries over the 1974–97 period.     

江苏省生产效率与全要素生产率分解的空间格局演变分析

选用超越对数函数的随机前沿模型,估算1993—2009年江苏省各县市的生产效率,并分解其全要素生产率增长率。结果表明:①苏南地区生产效率最高,苏北地区生产效率最低;各地区平均生产效率均出现不同程度下降,苏南下降幅度最小,苏北下降幅度最大;苏南地区生产效率较为均衡,苏中、苏北地区内部差距逐渐增大。②城市化率、GDP中第二产业比重、出口与GDP之比对生产效率具有正面作用,而政府干预程度与生产效率呈负相关关系。③各地区全要素生产率增长率是逐步增加的,增长主要是由技术进步率贡献的。④通过对TFP增长率和产出增长率联合对比把各县市分为四种类型。全要素生产率从另一个侧面揭示区域经济增长及差异的形成过程。     

Productivity growth in natural resource industries and the environment: an application to the Korean tuna purse-seine fleet in the Pacific Ocean

Measures of multifactor productivity growth in natural resource industries are misleading without accounting for the effects on the environment. This paper introduces environmental effects into an output-oriented Malmquist index of multifactor productivity growth in order to evaluate growth in productivity and technical efficiency for Korean purse seine vessels fishing for tuna in the Western and Central Pacific Ocean.     

江西省总量生产函数与全要素生产率估算:1952-2007

根据索洛余值法和C-D生产函数,建立了江西省总量生产函数模型,并利用江西省1952-2007年相关指标数据进行了测算。研究发现,江西省总量生产函数是一个规模报酬递减的生产函数,江西省经济增长模式为投资驱动型的粗放型经济增长模式,代表技术进步的全要素生产率对江西省经济增长的贡献率长期在20%左右。因此,要提高江西省的全要素生产率贡献率,必须把技术进步放在江西经济社会发展的优先战略地位。     

A Cross-Country Empirical Investigation of the Aggregate Production Function Specification

Many growth models assume that aggregate output is generated by a Cobb-Douglas production function. In this article we question the empirical relevance of this specification. We use a panel of 82 countries over a 28-year period to estimate a general constant-elasticity-of-substitution (CES) production function specification. We find that for the entire sample of countries we can reject the Cobb-Douglas specification. When we divide our sample of countries up into several subsamples, we find that physical capital and human capital adjusted labor are more substitutable in the richest group of countries and are less substitutable in the poorest group of countries than would be implied by a Cobb-Douglas specification.     

Patterns of technical change: a geometrical analysis using the wage–profit rate schedule

In this paper we examine some basic stylized facts of economic growth according to the modern restatement of the classical theory of income distribution. In particular, we make use of a wage–profit frontier in order to explore the patterns of technical change experienced by a set of 18 industrialized economies, during the last 40 years. Our main purpose is to document the evolution of technical change. Using empirical evidence from the Italian industry, we also make an attempt to provide an explanation to data from a classical perspective, alternative to the standard approach founded on the aggregate production function.     

Productivity versus elasticity: a normalized constant elasticity of substitution production function applied to historical Soviet data

This study tests the extensive growth hypothesis, which would attribute the Soviet economic slowdown to low elasticity of substitution and over-investment rather than deteriorating productivity growth. To circumvent the low availability of data, widely applicable new methods for estimating productivity and elasticity of substitution were developed based on the normalized constant elasticity of substitution (CES) production function. One is an extended version of the Solow residual calculation, and the other is a direct estimation of the time-varying parameter normalized CES production function. The application of the methods to the Soviet data showed a decreasing trend in productivity growth and a low elasticity of substitution of approximately 0.25. The results neither reject nor support the extensive growth hypothesis because of uncertainty in the interpretation of the low elasticity of substitution. The results suggest that it is reasonable to assert that both deteriorating productivity growth and low elasticity of substitution caused the Soviet economic slowdown. Further empirical studies on productivity and elasticity of substitution in the Soviet and other economies are necessary to fully understand relations between productivity growth, elasticity of substitution and economic development.     

我国商业银行规模经济评价方法研究

现有的关于银行规模经济评价的理论,要么基于参数法,要么专注于非参数法,很少有将二者兼顾考虑的评价方法.本文在充分考虑参数法和非参数法利弊的基础上,针对我国商业银行的特点提出了分类规模经济评价的思想.同时在利用DEA方法获得生产可能性集前沿面的基础上,建立了通过拟合生产函数获得各种规模经济评价指标的方法.     

The three Is of public schools: irrelevant inputs,insufficient resources and inefficiency

We examine the educational production function and efficiency of public school districts in Illinois. Using non-parametric kernel methods, we find that most traditional schooling inputs are irrelevant in determining test scores (even in a very general setting). Property tax caps are the only relevant factor that is related to districts’ financial constraints and have predominantly negative associations with test scores. Therefore, insufficient resources may be partially responsible for the lack of growth in test scores. For most other relevant inputs, we find substantial heterogeneity in the returns, which helps reconcile some of the puzzling results in the literature. We further find that there exist inefficiencies in school districts. Moreover, the level of test scores, commonly used as a measure of school effectiveness, (while related) differs substantially from our efficiency scores, and standard parametric approaches drastically underestimate school efficiency. We discuss the policy implications of our results.     

Linking Knowledge to Productivity: A Germany-Italy Comparison Using the CIS Database

This paper employs micro-aggregated data from the FirstCommunity Innovation Survey for assessing the contribution of the level and type of R & D spending, the purchase of new machinerywith embodied technological change, economies of scale, and information sharing with client and suppliers to productivity(total sales per employee) in German and Italian firms in 20 manufacturing industries. The regression analysis confirms theresults of previous studies that R & D and technological change embodied in new machinery and capital equipment aremajor factors affecting productivity at the firm level. However, the elasticity of productivity to both R & D and embodiedtechnological change is higher in Germany than in Italy. Conversely, information sharing with clients and suppliersrelated to innovation projects does not result in higher productivity, with the exception of a few industries (inparticular those producing traditional consumer goods) in Germany.     

Sources of productivity growth using the Färe-Primont decomposition. An empirical application to the Irish beef sector

Several competing methodologies for TFP estimation have been developed in the past decades. A popular approach in the literature is index number computation. The most widely implemented TFP indices face however several important limitations. For example, Fisher, Tornqvist or Malmquist TFP indices do not satisfy the transitivity test, precluding reliable direct inter-temporal comparisons. The recently developed Färe-Primont TFP index satisfies this property, and therefore it is applied to analyse the evolution of TFP in the Irish beef sector between 2010 and 2016. Moreover, this index is multiplicatively complete, allowing a consistent decomposition of TFP growth in different sources. The sample of Irish beef farms used in the analysis is clustered to account for differences in production technology in the sector. The cluster-specific TFP changes computed were found to present important differences across the seven clusters identified. Significant TFP growth was identified in five of the classes, while TFP declined for the other two. Dispersion and mobility of the TFP levels indicate a lack of structural changes in the sector regardless of the cluster considered.     

Human Capital,Technology, and Specialization: A Comparison of Developed and Developing Countries

GDP GDP function framework, and apply it to panel data. We find that factor supplies and openness to trade are important factors influencing the structure of production, but we also uncover interesting differences in results across output sectors and groups of countries. In addition, we find evidence that Hicks-neutral technological differences do not affect specialization. Finally, our results on the effect of openness highlight the sources of conflicts between developed and developing countries in multilateral trade negotiations. Received April 18, 2000; revised version received January 8, 2001     

Valuation of Urban Air Pollution: A Case Study of Kanpur City in India

This study estimates the monetary benefits to individuals from health damages avoided if air pollution is reduced in the urban industrial city of Kanpur in India. A notable feature of this study is that it uses data from weekly health-diaries collected for three seasons. For measuring monetary benefits, the study considers two major components of health cost that is incurred due to adverse effects of air pollution on health i.e., the loss in wages due to workdays lost from work and the expenditure incurred on mitigating activities. The study estimates that a representative working individual from Kanpur would gain Rs. 165.47 per year if air pollution were reduced to a safe level. The extrapolated annual benefits for the entire population in the city are Rs. 224.55 million.     

Expansions and contractions in Brazil, Colombia and Mexico: A view through nonlinear models

The study of asymmetric behavior of macroeconomic variables over business cycles has had a long tradition in economics. In this present work, we find evidence in favor of the hypothesis of having a STAR-type nonlinear asymmetric behavior of the economic activity, over the last two decades, in three Latin American countries: Brazil, Colombia, and Mexico. For Chile and Venezuela, the null hypothesis of a linear process could not be rejected under the method established by Granger and Teräsvirta [Granger, C.W.J., Teräsvirta, T., 1993. Modelling Nonlinear Relationships. Oxford University Press, New York]. Economic activity is proxied by monthly based industrial production indexes. Evidence of asymmetric behavior is also found according to the generalized impulse response functions analysis for the three countries.     

An Index Approach to Measuring Product Differentiation: A Hedonic Analysis of Airfares

The main objective of this paper is to introduce an Allen-type index of differentiation based on cost functions. With this index, we create an economic measure of product differentiation that quantifies differences between products. Applied research has some generally accepted economic measures, for example, the Herfindahl–Hirschman Index for market concentration, or the Gini coefficient for inequality. Product differentiation, however, does not yet have an established measure. Our objective is to fill that gap and introduce a measure that can be used in market-related applied research such as market power, antitrust, price indexes, or market strategy. To operationalize the index, we introduce the concept of a core product and use cost functions to measure the degree of differentiation from the core product. To demonstrate the use of the index, we study the effect of product differentiation on price formation in the airline industry using an enhanced hedonic model. The model is empirically tested on 103,980 observations of quarterly US domestic airfare data between 2002 and 2016 and shows that product differentiation has a significant effect on both price and mark-up.