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on Efficiency and Productivity |
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Issue of 2007‒05‒19
seven papers chosen by |
| By: | Kwoka, J.; Pollitt, M. |
| Abstract: | This paper analyses the performance impact of the merger wave which took place in the US electricity industry during the period 1994-2003. It does so by analyzing the impact on operating and total cost in electricity distribution. While there are past studies of efficiency and productivity effects, as well as of prices, profits, and other outcomes, this study differs in several ways. First, the database consists of many merging and non-merging firms, rather than only a few on which to base inferences. Second, all of these mergers arise in a single industry, greatly facilitating controlled comparison. Third, we have data on the several years of pre-merger and post-merger efficiency of the specific merging units, unlike virtually all past studies. And finally, we employ a powerful nonparametric technique - data envelopment analysis - to measure the efficiency of each operating unit. The results indicate that electricity mergers are not consistent with improved cost performance. |
| Keywords: | mergers, efficiency analysis, electricity distribution, data envelopment analysis. |
| JEL: | L25 L43 L94 |
| Date: | 2007–05 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0725&r=eff |
| By: | Carol Corrado; Paul Lengermann; Larry Slifman |
| Abstract: | In this paper, we decompose aggregate labor productivity growth in order to gauge the relative importance of multinational corporations (MNCs) to the economic performance of the United States in the 1990s. As we define it, the MNC sector refers to the U.S. activities of multinational corporations operating in the United States. We develop productivity estimates for MNCs using (1) published and unpublished industry-level data from two surveys conducted by the Bureau of Economic Analysis and (2) productivity data for industries and major sectors from the FRB productivity system (Bartelsman and Beaulieu 2003, 2004). The resulting MNC sector accounted for about 40 percent of the gross product of all nonfinancial corporations and all of the pickup in nonfinancial corporate labor productivity in the late 1990s. Accordingly, the MNC sector accounted for more than half of the acceleration in labor productivity growth of all U.S. nonfarm private businesses. |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2007-21&r=eff |
| By: | Bronwyn H. Hall (University of California, Berkeley); Francesca Lotti (Bank of Italy, Research Department); Jacques Mairesse (INSEE-CREST) |
| Abstract: | Italian manufacturing firms have been losing ground with respect to many of their European competitors. This paper presents some empirical evidence on the effects of innovation on employment growth and therefore on firms’ productivity with the goal of understanding the roots of such poor performance. We use firm level data from the last three surveys on Italian manufacturing firms conducted by Mediocredito-Capitalia, which cover the period 1995-2003. Using a modified version of the model proposed by Harrison, Jaumandreu, Mairesse and Peters (2005), which separates employment growth rates into those associated with old and new products, we provide robust evidence that there is no employment displacement effect stemming from process innovation. The sources of employment growth during the period are split equally between the net contribution of product innovation and the net contribution from sales growth of old products. However, the contribution of product innovation is somewhat lower than that for the four comparison European countries considered by Harrison et al. |
| Keywords: | Innovation, employment, productivity, Italy. |
| JEL: | L60 O31 O33 |
| Date: | 2007–04 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_622_07&r=eff |
| By: | Kui-Wai Li (City University of Hong Kong, Hong Kong SAR); Tung Liu (Department of Economics, Ball State University); Lihong Yun (City University of Hong Kong, Hong Kong SAR) |
| Abstract: | This paper analyzes the productivity change of the thirty provinces in China’s post-reform economy. The productivity change is estimated from the stochastic frontier model, in which the maximum likelihood estimation is applied to an augmented logarithmic production function incorporated with a human capital variable. The empirical results show technical progress is the main contributor to productivity growth and the scale of economy became important in recent years, but technical efficiency has edged downwards in the sample period. We also found that the physical capital is the important factor for economic growth and human capital is inadequate even though it has a positive and significant effect on growth. The relevant policy implication for a sustainable post-reform China economy is the need to promote human capital accumulation and improvement in technical efficiency. |
| Keywords: | technical efficiency, technical progress, human capital, China economy |
| Date: | 2007–04 |
| URL: | http://d.repec.org/n?u=RePEc:bsu:wpaper:200701&r=eff |
| By: | Alfredo Martín-Oliver (Banco de España); Vicente Salas-Fumás (Banco de España; Universidad de Zaragoza); Jesús Saurina (Banco de España) |
| Abstract: | This paper contains estimates of physical and intangible (information technology, advertising and training) capital stock, together with capital, labor and externally provided input services, of Spanish commercial and saving banks in the period 1983 to 2003. Capital stocks are valued at replacement costs and assets’ services flows are computed using estimates of the risk-adjusted user cost of capital. Replacement costs of assets are substantially higher than book values and economic estimates of costs of input services allow for more accurate measures of efficiency and productivity of banks. |
| Keywords: | Spanish banks, intangible assets, cost of capital services |
| JEL: | G21 G31 M41 |
| Date: | 2007–05 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:0711&r=eff |
| By: | Kyoji Fukao |
| Abstract: | In this paper, I examine the macroeconomic impact of inward FDI in Japan. From a general equilibrium point of view of the macroeconomy, probably the most important host country benefit of inward FDI is improvements in productivity caused by the inflow of managerial resources. In the first part of this paper, which is largely based on the results of Fukao, Ito and Kwon (2005), I review the evidence suggesting that inward FDI raises the average total factor productivity of firms in Japan. In the second part, using a general equilibrium model of an open macroeconomy, I simulate the macroeconomic impact of an increase in the inward FDI stock. The results suggest that if Prime Minister Abefs goal on inward FDI, which is to increase the inward FDI stock to 5 percent of GDP by the end of 2010 is achieved, this will help to raise Japanfs GDP by 0.226 percent and real wage rates by 0.156 percent. Dividend payments abroad by foreign-owned firms and the fall in Japanfs foreign investment income caused by the inflow of capital (or the decline in capital outflows), will make the increase in Japanfs GNP (which includes net foreign investment income) smaller than the increase in GDP. The increase in GNP will be 0.125 percent of GDP. |
| Date: | 2007–05 |
| URL: | http://d.repec.org/n?u=RePEc:hit:hitcei:2007-4&r=eff |
| By: | Natália Pimenta Monteiro (Universidade do Minho - NIPE) |
| Abstract: | this study exemines changes union contracts and wage structure during and after the introduction of regukatory reforms (deregulation and privatisation) in the Portuguese banking sector. The main finding is that, despite a relative wage erosion detected in the contract dada, banking workers were able to enjoy an increasing wage premium in the period 1985-2000, probably reflecting the increasing profitability of the industry and the rise in labour productivity. The evidence also shows that some specific groups benefited relatively more than others: the least skilled and educated workforce and male workers gained more from the regulatory reforms. However, this unequal sharing of the wage premium did not raise wage inequality across ownership groups in the industry. |
| Keywords: | Deregulation, privatisation, wage structure, Portuguese banking industry |
| JEL: | J31 J45 L33 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:7/2007&r=eff |