Export behavior and productivity growth: Evidence from Italian manufacturing firms

Export Behavior and Productivity Growth: Evidence from Italian Manufacturing Firms. — This paper provides econometric evidence supporting the hypothesis that exporting implies learning effects. Learning-by-exporting is modeled as a change, induced by export behavior, in the stochastic process governing firms’ productivity. Empirically, this is implemented by specifying cross-section regressions of labor productivity growth on measures of export behavior, controlling for past productivity growth and other firms’ characteristics. Using a sample of Italian manufacturing firms, it is found that exporters do not exhibit faster productivity growth. Nevertheless, growth in value added per worker has a positive and significant relation with firms’ export intensity. In other words, only firms substantially involved in exporting have a significantly higher rate of productivity growth. This result suggests that learning-by-exporting is by no means simply the outcome of the presence in the export market.     

Product differentiation,export participation and productivity growth: Evidence from Chinese manufacturing firms

In this paper, we investigate how the degree of export participation and product differentiation affect firms' productivity growth through learning-by-exporting. We extend the model of Melitz and Ottaviano (2008) to endogenize the effort firms allocate to learning. This effort choice depends on both the degree to which firms enter export markets and the extent to which products are differentiated across producers. Using a firm-level dataset from China's manufacturing industries, we implement propensity score matching methods to test the model's predictions. Our results indicate that the degree of export participation is positively correlated with TFP improvements. Simultaneously, we empirically verify that firms exporting less differentiated products experience faster TFP growth than those exporting more differentiated products.     

Banking crisis and productivity of borrowing firms: Evidence from Japan

We investigate the effects of bank distress on the productivity of borrowing firms by using data on listed companies in the Japanese manufacturing industry during the 1990s. We find that deterioration in the financial health of banks, which is measured by a decline in the capital-asset ratio, decreased the productivity of their borrowers during the period of the severe financial crisis (FY1997–1998). Our finding empirically confirms the theoretical view that an increase in financial friction negatively affects the productivity of the corporate sector.     

Outward foreign direct investment and technical efficiency: Evidence from Taiwan's manufacturing firms

This paper uses firm-level panel data from Taiwan's manufacturing industries from 1987 to 2000 to investigate the impact of outward foreign direct investment (OFDI) on the technical efficiency of the OFDI firms. Propensity score matching is used to construct an appropriate group of non-OFDI firms to compare with OFDI firms, and a metafrontier framework is subsequently used to calculate comparable technical efficiencies for both groups of firms. Our empirical results reveal that the technical efficiencies of Taiwan's manufacturing firms were increasing over the entire sample period. In addition, our results suggest that the technological advances and the technical efficiency of Taiwan's manufacturing firms are positively correlated with their OFDI activity.     

OFDI and stock returns: Evidence from manufacturing firms listed on the Chinese A-shares market

Using data for manufacturing firms listed on the Chinese A-shares market over the 2000−16 period, this paper studies the impact of outward foreign direct investment (OFDI) on stock returns using the propensity score matching. It shows that when firms carry out OFDI for the first time, they have to deal with the risks of the overseas market; therefore, the OFDI firms show significantly higher returns. Furthermore, OFDI affects stock returns through the risk channel rather than the diversification channel; the risks OFDI firms are exposed to are mainly demand and political risks. OFDI firms face different risks than non-OFDI firms, thus investors can obtain diversification benefits by purchasing stocks of OFDI firms. In addition, investors can make diversified investments based on the seven dimensions of the nature of firms and OFDI to increase the opportunity to obtain stock returns. For firms, they can conduct on-site inspections before conducting OFDI, becoming familiar with the host country market, laws and regulations. Firms should try to choose politically and economically stable countries to invest in.     

The direct and indirect effects of infrastructure on firm productivity: Evidence from Chinese manufacturing

This paper attempts to distinguish and estimate the direct and indirect effects of infrastructure on firm productivity. The latter arises from the infrastructure-agglomeration link and has been largely overlooked in the literature on infrastructure. An analytical framework is then proposed to estimate both effects. Finally, empirical results are obtained using large-scale firm-level survey data from China. Major findings include: (1) all the three kinds of infrastructure–road, telecommunication servers and cable–are found to directly promote firm productivity; (2) they also exert a positive indirect effect on firm productivity through the agglomeration channel; and (3) the empirical results are robust to different agglomeration indicators and different subsamples.     

Regional financial technology and shadow banking activities of non-financial firms: Evidence from China

Financial technology has greatly revolutionized the finance industry. However, the impact of financial technology on the shadow banking activities of non-financial firms has not been examined. Using a sample of Chinese listed firms from 2011 to 2018, we find that regional financial technology is positively associated with the shadow banking activities of non-financial firms, which is more pronounced for firms with low profitability and firms listed only in China’s A-share market. We show that financial technology can enhance the shadow banking activities by alleviating financing constraints. In addition, an increase in the equalization of profit rate and an increase in investment in the real economy reduce the positive effect of financial technology on the shadow banking activities. Further analysis suggests that financial regulations can attenuate excessive shadow banking activities of non-financial firms driven by financial technology.     

Self-selection and performance of R&D input of heterogeneous firms: Evidence from China's manufacturing industries

Applying the theories of heterogeneous firms and the propensity score matching difference-in-differences (PSM-DID) method to a rich dataset of Chinese manufacturing firms, this paper examines the self-selection of firm-level R&D input and estimates the net effect of R&D on productivity. The analysis shows that (1) for Chinese manufacturing firms as a whole, R&D input is influenced by firm productivity: more productive firms are more likely to invest in R&D; (2) controlling for the self-selection effect, the net output elasticities of R&D input in one year and two years after R&D input are 3.92% and 5.25%, respectively; (3) although state-owned enterprises (SOEs) are more likely than all other ownership groups to invest in R&D, the R&D input is not productive; (4) although enterprises owned by investors outside of Mainland China are the least likely to invest in R&D, the output elasticity of R&D is more significant and larger in this group than in SOEs and privately owned Chinese firms; and (5) surprisingly, the net effect of R&D is not significant in high-tech industries. Policy implications are derived from the findings.     

Estimation of productivity and markups with price dispersion: Evidence from Chinese manufacturing during economic transition

We estimate firm productivity and markups in the presence of heterogeneous output and input prices. We assume that firms are monopolistically competitive in the output market and that state firms are favored and pay lower prices for inputs due to political connections. The proxy-variable (or called the control-function-based) approach of structurally identifying production functions and productivity is customized to our new setting. Our approach solves the underidentification problem inherent in the standard proxy-variable method. We investigate the Chinese transportation equipment industry and find evidence against perfect competition and price homogeneity. We also find that productivity and markup differentials and dynamics are consistent with the market-oriented reforms in China.     

参与全球生产网络对我国传统产业劳动效率的影响——以华东地区纺织服装业为例

文章选取超越对数劳动要素成本函数的随机前沿模型,构建了2001-2012年华东地区纺织服装产业的省级面板数据,对传统产业中典型行业纺织服装业的劳动效率进行测度,同时构建网络位置指标考察参与全球生产网络深度对产业劳动效率的影响。研究发现,参与全球生产网络将改变传统产业劳动效率改善的惯性路径,华东地区纺织服装业的劳动效率呈"倒U型"提升路径,加入全球生产网络初期,产业劳动效率有下降过程,随着参与全球生产网络广度和深度的增加将推动产业在全球生产网络中网络位置的提升,进而促进区域产业劳动效率的提升。     

Thai manufacturing small and medium sized enterprise technical efficiency: Evidence from firm-level industrial census data

Thai manufacturing small and medium sized enterprises (SMEs) face intense competition in domestic and foreign markets. Given their importance to the economic development of the country it is important to have a clear understanding of their readiness to face the rigors of international competition, including the barriers and specific problems that they face. This study uses a stochastic frontier analysis (SFA) and technical inefficiency effects model to analyze the technical efficiency of Thai manufacturing SMEs and key factors impacting upon it. Analysis of cross-sectional data from a 2007 census of Thai manufacturing SMEs indicates that their weighted average technical efficiency is approximately 50 percent, signifying a high level of technical inefficiency which is reducing potential output. The inefficiency effects model reveals that firm size, firm age, skilled labor, ownership characteristics and location are firm-specific factors that significantly affect the technical inefficiency of production. Key measures to improve the technical efficiency of Thai manufacturing SMEs are an adequate supply of inputs, access to credit facilities, extensive infrastructural development and training programs for employees.     

Technical Inefficiency and Production Risk in Rice Farming: Evidence from Central Luzon Philippines*

There have been many previous studies of technical inefficiency in rice production in the Philippines, but none has focused simultaneously on production risk and technical inefficiency at the farm level. Rice production is inherently risky because of the heterogeneous production environment. In this study, we analyze technical inefficiency in a rainfed lowland rice environment in Central Luzon using a stochastic frontier production function with a heteroskedastic error structure. An 8‐year panel dataset collected from 46 rainfed rice farmers was used to estimate flexible functional specifications. Over the whole period, the average technical efficiency was found to be 79 percent. Results indicate that there is a high degree of variability in technical efficiency estimates, which can be attributed to the instability of farming conditions in the rainfed lowland environment. Mean output was signifificantly influenced by area planted to rice, labor and the amount of fertilizer used. Consequently, these inputs were found to be risk‐increasing, whereas herbicide was found to be a risk‐reducing input.     

The impact of differential power pricing policy on firm productivity in China: Evidence from iron and steel firms

The differential power pricing (DPP) policy is implemented as an important measure to curb the unrestrained development of high-energy-consuming industries, optimize industrial structure, and promote the upgrading of industrial technology. However, it is unclear how the DPP policy affects the productivity of regulated firms. Using the difference-in-differences approach, this study is the first to investigate empirically the DPP policy’s impact on the productivity of China’s iron and steel firms—a top carbon emitter. The results show that the DPP policy has a significant negative effect on the productivity of iron and steel firms, leading to a 1.20% per annum decrease in the total factor productivity growth of these firms, primarily because the policy significantly hinders firms’ scale efficiency. Considering the heterogeneity of firms, the impeding impact on large-scale and state-owned firms is less than that on the firms of full sample. To curb the irrational expansion of energy-intensive industries and eliminate backward production capacity, the government should implement the DPP policy more precisely according to the heterogeneity of firms, and other auxiliary measures, such as cost compensation for innovation, are also recommended.     

The productivity impacts of energy efficiency programs in developing countries: Evidence from iron and steel firms in China

We study the impact of a national energy efficiency program on total factor productivity (TFP) growth in firms in China's iron and steel industry. Using detailed firm-level survey data and multiple approaches to estimate program effects, we find participating firms experienced greater annualized TFP change. Our base specification estimates the program increased annual TFP growth by 3.1 percentage points, implying an annual private benefit of 148.7 million RMB/year per firm, with approximately equal contributions from technical change and scale efficiency change. Our results suggest that firms undervalued energy efficiency investments prior to the start of the program.     

Agricultural labour and the incidence of surplus labour: experience from China during reform

This paper contributes to the pool of studies of rural underemployment and revisits a number of estimates of surplus agricultural labour in China. The study is devoted to the conceptualization, identification and measurement of surplus at regional, provincial and national levels by a stochastic frontier functional specification. The analysis indicates that the existing size of agricultural surplus labour is still significantly large with the continued practice of the household registration system and China's WTO membership.     

Two-dimensional analysis of the impact of outward FDI on performance at home: Evidence from Japanese manufacturing firms

This paper empirically investigates two dimensions of changes in firm behavior and performance before and after foreign direct investment (FDI). The first dimension is the difference between vertical and horizontal FDI. The second dimension is the effect of outward FDI on firms’ production and non-production activities in the home country. In our careful empirical analysis we use the propensity score matching method to show that the impact of outward FDI differs by dimension, that is, by FDI type and firms’ production and non-production activities. In particular, while horizontal FDI increases demand for non-production workers, vertical FDI increases demand for skilled production workers.     

Role of Individual Social Capital in Wage Determination: Evidence from China

The present study examines the role of individual‐level social capital in workers’ wage determination in a Nash‐bargaining wage model using Chinese micro‐level data. The study finds a significant contribution of individual‐specific social capital to the wage level. In particular, larger individual social networks and workers’ positive attitudes toward social capital significantly increase the wage level. Moreover, the effect of social capital on the wage level is much larger for men than for women. The results indicate that construction of individual social capital could increase workers’ wages. However, efforts are needed to reduce the unequal contributions of social capital between men and women.     

Social Capital and Total Factor Productivity: Evidence from Chinese Provinces

The impact of social capital on economic development has been broadly studied by scholars. However, research in the Chinese context is relatively rare. Drawing upon data from the China General Social Survey, our results suggest that the enhancing effect of social capital on total factor productivity is very limited in the case of China. The network dimension of social capital is significant only in pooled OLS estimations, and trust as well as the participation dimension of social capital exert no impact across all estimations. Our interpretation is that this is partly due to the fact that trust, values and norms formed in civil society are inherently difficult to transmit to the market sector. Besides, the impact of social capital on economic performance is undermined when physical capital plays a significant role in production. We therefore propose that the effect of social capital on economic performance is contingent on localized social and economic conditions.