Comparisons of agricultural productivity growth in China and India

We measure and compare agricultural total factor productivity (TFP) growth and its components (efficiency and technical change) in China and India and test the TFP series for the existence of structural breaks relating the evolution of TFP to policy milestones. Our results show that agricultural TFP growth accelerates in China after 1979 and in India after 1974, although China’s agricultural sector clearly outperforms India’s. The main explanation of these differentials is that agricultural growth in China benefited from more fundamental institutional and policy reforms in agriculture than India. There is some evidence that the transformation of industry in China was also important for agricultural TFP growth. Manufacture growth absorbed labor and reduced employment in agriculture, creating incentives for capital investment and technical change that kept output per worker in agriculture growing at high rates. Fewer changes in agricultural policies and in the dynamics of manufacturing in India resulted in slower growth in agricultural productivity, despite policy changes that accelerated economic growth in recent years.     

Trade and product innovations as sources for productivity increases: an empirical analysis

Increases in total factor productivity (TFP) are commonly associated with technological innovations measured by the stock of R&D. Empirical evidence seems to corroborate this relationship. However, in trading countries like The Netherlands, productivity increases, even in industry, can also be the result of innovations in the way transactions are managed. These innovations reduce transaction costs and exploit the welfare gains from (further) international division of labour. Such innovations are only partly included in R&D data. Consequently there is not much attention for these ‘trade innovations’—as we label them—in policy. In an empirical analysis this paper compares the influence of trade innovations with the influence of the stock of R&D on TFP in The Netherlands. The regression results show that in this country trade innovations are as important for TFP as technological innovations which directly affect the efficiency of production, which we label ‘product innovations’.      

Beware of breaks in exchange rates: Evidence from European transition countries

We endogenously search for the single most decisive structural break in exchange rate for a group of European transition countries under the hypothesis that structural breaks in exchange rates are driven by exchange rate policies. Detected breaks were frequently associated with major changes in exchange rate regime. However, several breaks were found not to be driven by exchange rate policies. By this token, the lack of coincidence between policy step and exchange rate regime shift hints at imperfect timing of exchange regime modification. Further, since a one time break can lead to inconsistent results, structural breaks in exchange rates should be accounted for in empirical research.     

Industrial Productivity Growth Linkages Between OECD Countries, 1970–90

Technology ‘spillovers’ are increasingly being recognized as sources of productivity growth. International ‘convergence’ in productivity levels has also been noted in recent studies. This paper reports a study of international total factor productivity (TFP) growth for 11 industrial sectors in seven OECD countries. Spillover variables are defined based on interindusty and international invention input–output (I(IO)) weights. These variables are tested against import-weighted variables. The study concludes that I(IO)-weighted R&D ‘spill-ins’ are important determinants of TFP growth and that convergence is dependent on domestic RBD.     

Testing the convergence hypothesis: a longitudinal and cross-sectional analysis of the world trade web through social network and statistical analyses

Different theoretical perspectives support opposite views on convergence: although the dominant view is that convergence is the inevitable outcome of globalization, divergentists (that is, world-system economists and, potentially, also evolutionary geographic ones) argue that convergence forces could be annihilated by the need to keep power relationships within the international division of labor. Even when limiting the convergence issue to international trade, the debate has so far been inconclusive, because various studies have dealt with different and/or short time series or selected too small and different sets of countries. Moreover, none of these studies have analyzed trade patterns and have instead been limited to the aggregate value. Here, through a social network analysis, we examine the world trade patterns from 1980 to 2016 (1980–1992, 1993–2007 and 2008–2016) of at least 164 countries, which have been divided into import and export patterns and into four groups of countries: from core countries to far periphery ones. We test the convergence hypothesis in two directions: the level and trend of convergence, and its possible determination by means of structural or economic globalization, measured in terms of exchanges density and economic values, respectively. We have found that the convergence hypothesis only seems to be confirmed when considering the pure structural aspect and core countries. Conversely, economic convergence—which also includes the structural dimension—has been found to be high for core countries and to increase over time. Moreover, our analysis shows that economic globalization influences convergence, albeit in a strongly negative way. Therefore, our findings seem to support divergentists and the convergence hypothesis should be rejected.

     

Corporate cash holdings and total factor productivity – A global analysis

Studies concerning total factor productivity (TFP) have investigated the effect of TFP on economic growth from a country-level perspective, which is a critical issue in the macroeconomics field. Few studies have examined how corporate financial decisions influence TFP from a firm-level perspective. Specifically, no extant studies have investigated how cash holdings affect firm productivity. This study utilizes data for firms in 65 countries during 1993–2017 to investigate the effect of cash holdings on TFP from a corporate perspective. The findings show that firms with higher cash holdings can enhance TFP. The results hold after considering endogenous problems, financial constraints, financial crises, corporate governance, institutional quality, and financial development as well as various robustness tests. Furthermore, we examine whether firms consistently invest their cash holdings into research and development (R&D) expenditures enhances firm productivity. The evidence indicates that higher cash holdings lead to steady increases in R&D expenditure, which improves firms’ TFP.     

No Mangoes in the Tundra: Spatial Heterogeneity in Agricultural Productivity Analysis*

In line with the wider macro productivity literature existing studies of agricultural production largely neglect technology heterogeneity, variable time‐series properties and the potential for heterogeneous but correlated total factor productivity (TFP) across countries. Our empirical approach accommodates these difficulties and seeks to model the nature of the cross‐section dependence in a sample of 128 countries (1961–2002). Our results suggest that agro‐climatic environment drives similarity in TFP evolution across countries with heterogeneous production technology. This provides a possible explanation for the failure of technology transfer from advanced countries of the temperate ‘North’ to arid and/or equatorial developing countries of the ‘South’.     

The Terms of Trade and the International Transfers of Productivity Gains

In international economic relations, when movements of labour are limited and fiscal redistributive policies non-existent, changes in the terms of trade (the ratio between the prices of exports and imports) are the main driving force for the international redistribution of incomes or of productivity gains. The concept of productivity flows linked to price changes can be extended from the interindustry framework to deal with international relations bringing some new insights into the terms of trade issues. The paper develops a conceptual framework for the computation of international flows of productivity gains, taking into consideration the role of exchange rates and the meaning of Purchasing Power Parities. It is completed by a set of computations on Swiss relations with the rest of the world.     

Exchange rate, inflation and unemployment in East European economies: the case of Poland and Hungary*

The aim of the paper is to model the impact of exchange rate on both inflation and unemployment variables in economies which are characterized by important structural changes, i.e. a transition phase moving from centralized economies towards market economies. This phenomenon, which is common to the East European countries, stressed different effects both for what concerns the behaviour of economic agents and for what concerns fiscal and monetary measures adopted by governments and aiming to keep under control the inflation–unemployment trade off. Time series relationships between these variables are investigated within an econometric model. Economic theory and the available data on the hypothetically relevant variables, along with the consideration of the main facts occurred in the period under study, characterize our information set. It is found that single equation analysis yields inefficient inference relative to the whole system analysis, and important structural changes are detected which reflect possible breaks in the structure of the economic system along with a change in economic policy.     

Testing for structural breaks in dynamic factor models

In this paper we investigate the consequences of structural breaks in the factor loadings for the specification and estimation of factor models based on principal components and suggest procedures for testing for structural breaks. It is shown that structural breaks severely inflate the number of factors identified by the usual information criteria. The hypothesis of a structural break is tested by using LR, LM and Wald statistics. The LM test (which performs best in our Monte Carlo simulations) is generalized to test for structural breaks in factor models where the break date is unknown and the common factors and idiosyncratic components are serially correlated. The proposed test procedures are applied to datasets from the US and the euro area.     

Quantifying Structural Change in U.S. Agriculture: The Case of Research and Productivity

Previous work on structural change in agriculture has failed to distinguish long-run trends from structural breaks leading to new trends. We measure structural changes as statistically significant breaks in either stochastic or deterministic time trends, and apply these measures to agricultural productivity and research. Productivity has a break in 1925 accompanying agriculture's early experience with the Great Depression. Research trends shifted in 1930 as the Depression and new technology began to strongly influence efficient farm size and capitalization. After modeling lags between research and productivity impacts in a vector autoregression (VAR), we compare our results to earlier work by developing a procedure to estimate the rate of return to research from the impulse response function of the VAR.     

Technology capital: the price of admission to the growth club

We assess long-run patterns of global agricultural productivity growth between 1970 and 2005 and examine the relationship between investments in technology capital and productivity. To measure agricultural total factor productivity (TFP) we employ a Solow-type growth accounting method to decompose output growth into input and TFP growth. For technology capital we construct two indexes reflecting national capacities in agricultural research and education-extension for 87 developing countries. We then correlate technology capital levels with long-term growth rates in agricultural TFP. Our findings show that global agricultural TFP growth as a whole accelerated since 1980, although performance was very uneven across developing countries. TFP growth rates were significantly influenced by technology capital. Marginal improvements to research capacity, given a minimal level of extension and schooling existed, were associated with faster TFP growth. However, marginal increases in extension-schooling without commensurate improvements in research capacity did not improve productivity performance.     

国际贸易、技术进步和中国工业行业的生产率增长

内生增长理论认为技术进步是经济增长最为重要的助推力,推动技术进步的力量是对研发的投资和国际贸易的发展。随着经济贸易与信息技术的飞速发展,社会对国际贸易、技术进步的关注程度日渐提升。通过深入分析国际贸易与工业行业生产率之间的关系,可以有针对性地应用有效手段对国际贸易进行调整,使其可以继续带动技术的进步并促进工业行业生产率的提升。基于此,论文探究了我国国际贸易、技术进步与工业行业生产率增长的关系,阐述了国际贸易、技术进步对于工业行业生产率的真实影响。     

Impact of R&D and Technology Diffusion on Productivity Growth: Empirical Evidence for 10 OECD Countries

This paper examines the empirical evidence on the impact of performed R&D and of R&D embodied in intermediate and capital goods on productivity performance in 10 major OECD countries over the last two decades. To quantify intersectoral and international technology flows, industry-level embodied R&D variables were constructed from an input–output (IO) R&D embodiment model. The productivity variables used are discrete Divisia growth indexes of total factor productivity (TFP), which were estimated from an IO growth accounting model. The results from pooled regressions indicate that the rates of return of the R&D variables were positively significant and increasing in the 1980s. In particular, embodied R&D is an important source for TFP growth in services, indicating very high social returns of the flows of capital-embodied technology into this sector. Moreover, the information and communi-cation technology (ICT) cluster of industries played a major role in the generation and cquisition of new technologies at the international level.     

Why do some economies benefit more from climate finance than others? A case study on North-to-South financial flows

The Copenhagen and Paris Agreements, in which developed countries committed to mobilise USD 100 billion a year by 2020, indicate that climate finance will continue to grow. Even though economic development is not the aim of climate finance, climate-related disbursements will generate an economic impact on recipient countries’ economies. This impact will also reach other countries (including climate finance donors) through induced international trade. In this paper, we apply a structural decomposition analysis to study why the economic impact of climate finance varies between countries. We focus on specific climate actions and quantify the contribution of four drivers: value-added intensity, domestic multiplier, foreign multiplier and trade structure. The paper helps identifying the factors with the greatest potential to enhance the economic gains of climate finance in each country. This information can be useful for policy-makers trying to design national strategies that exploit the synergies between climate action and economic development.     

Testing Integration of Macroeconomic Time Series in Transitional Socialist Economies. A Modification of Perron Test

The presence of structural breaks reduces the power of integration tests. A number of methods were suggested to improve the statistical properties of integration tests in the presence of structural breaks. The most known are Perron tests, which allow to test for the level of integration of time series with one structural break. Perron tests allow for two types of structural breaks: additive outlier an innovative outlier. These tests are, however, not very useful in testing the level of integration of macroeconomic time series in countries in transition from centrally-planned to market economy. In such case one should expect two structural breaks to affect the time series: one at the beginning and one at the end of the transformation process. Test that allows for two additive outlier type structural breaks in time series is developed in this paper. This test has superior power as compared to standard Dickey-Fuller and Perron tests. This paper provides asymptotic distribution as well as finite sample properties of proposed test. Therefore practitioners receive a reliable tool for analyzing macroeconomic processes in transitional economies. This revised version was published online in July 2006 with corrections to the Cover Date.     

标准化战略与经济全球化研究

随着经济全球化的发展,国与国之间的经济交往、技术交流逐渐打破原有的界线,形成全球范围的大生产和大流通。标准不仅是企业之间的竞争,更是国与国之间的竞争。标准,已成为世界各地通用的一种技术语言,尤其是国际标准已成为国际贸易有效规则的一部分和产品质量仲裁的准则。国际上的标准化组织和一些工业发达国家为了在国际标准化活动中争取主动权、发言权,反映本国的要求,体现本国的利益,开始制定并实施标准化战略,全球形成了一股标准化战略热。文章详细分析了经济全球化的特征和表现,提出了标准化战略是经济全球化强有力的技术支撑和管理工具,成为企业跨国经营、产品跨国生产、商品和资源跨国流动及世界范围技术交流的规则和准则。     

Does digital service trade boost technological innovation?: International evidence

Digital technology is profoundly changing the international economic and trade pattern, and digital service trade is increasingly becoming an important carrier of transnational knowledge spillover. This study investigates the relationship between digital service trade and technological innovation. Based on the panel data of 131 countries from 2005 to 2020, empirical results show that digital service trade significantly promotes technological innovation. This study shows that digital service trade can promote technological innovation through four mechanisms: increasing income incentives, accelerating knowledge spillover, triggering trade liberalization, and promoting financial deepening. The results of panel threshold model show that economic development, urbanization, and population aging can lead to regime changes in the innovation effect of digital service trade. In addition, the results of heterogeneity test show that national characteristics such as economic development, per capita income, industrialization, and economic freedom, influence the innovation effect of digital service trade. Our findings have implications for developing an international innovation cooperation system based on digital service trade.     

Structural change and economic behaviour: The case of UK exports

In this paper Stephen Hall, Giovanni Urga, and John Whitley apply a new econometric technique to date unknown breaks in UK export behaviour. They show how the evidence points to a structural shift in 1979. Although there is some support for a supply-side interpretation in that there have been changes in the behaviour of prices, there has also been a shift in the underlying demand for UK exports. They also find that variables which proxy changes in the quality of UK exports, or other supply-side influences, do not properly account for the observed structural break in UK export performance.     

A Unit Root Test Using a Fourier Series to Approximate Smooth Breaks*

We develop a unit‐root test based on a simple variant of Gallant's (1981) flexible Fourier form. The test relies on the fact that a series with several smooth structural breaks can often be approximated using the low frequency components of a Fourier expansion. Hence, it is possible to test for a unit root without having to model the precise form of the break. Our unit‐root test employing Fourier approximation has good size and power for the types of breaks often used in economic analysis. The appropriate use of the test is illustrated using several interest rate spreads.