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on Efficiency and Productivity |
|
Issue of 2012‒06‒05
twenty papers chosen by |
| By: | Giovanni Marin (IMT Lucca Institute for Advanced Studies) |
| Abstract: | This paper investigates the patterns of emission efficiency (value added per emission) growth of 23 manufacturing sectors in 12 European countries with a focus on five emissions (CO2, NOx, NMVOC, SOx and CO). Emission efficiency growth is expected to be triggered by improvements in the efficiency of frontier countries through the diffusion of better technologies to laggard countries. This effect is likely to differ according to the distance from the frontier country. Finally, the role of productivity patterns (Total Factor Productivity) and energy prices dynamics is assessed. Results based on the European NAMEA (National Accounting Matrix including Environmental Accounts) further merged with sector accounts highlight significant spillovers from leaders in emission efficiency and a general tendency to converge for laggard countries and sectors (except for NMVOC emission efficiency). Energy prices weakly induce improvements in emission efficiency, with the effect being generally stronger for sectors and countries farther away from the emission efficiency frontier. Finally, total factor productivity (TFP) is strongly correlated with emission efficiency while the distance from TFP frontier significantly harms emission efficiency growth. |
| Keywords: | convergence, environmental efficiency, NAMEA, technological diffusion |
| JEL: | Q55 Q56 O33 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:ial:wpaper:2&r=eff |
| By: | Färe, Rolf (Dept. of Agriculture and Resource Economics); Grosskopf, Shawna (Dept. of Economics and Dept. of Agriculture and Resource Economics); Lundgren, Tommy (CERE, Centre for Environmental and Resource Economics); Marklund, Per-Olov (CERE, Centre for Environmental and Resource Economics and CERUM, Centre for Regional Science); Zhou, Wenchao (CERUM, Centre for Regional Science) |
| Abstract: | This paper studies the interaction between economic and environmental performance. Applying the directional output distance function approach, the purpose is to compare estimates of Luenberger total factor productivity indicators, including and excluding bad outputs. Specifically, based on unique firm level data from Swedish manufacturing covering the period 1990 to 2008, we explore to what extent excluding bad outputs leads to erroneous productivity measurement. The main conclusion is that bad outputs should not only be included in the estimations, but also reduction in bad outputs should be credited. From this point of view the directional output distance function approach and the Luenberger indicator serves as an appropriate basis of productivity measurement. |
| Keywords: | Swedish manufacturing; Luenberger indicator; emissions; productivity |
| JEL: | D24 Q01 Q53 |
| Date: | 2012–05–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:slucer:2012_013&r=eff |
| By: | Giovanni Marin (IMT Lucca Institute for Advanced Studies) |
| Abstract: | This paper investigates the patterns of emission efficiency (value added per emission) growth of 23 manufacturing sectors in 12 European countries with a focus on five emissions (CO2, NOx, NMVOC, SOx and CO). Emission efficiency growth is expected to be triggered by improvements in the efficiency of frontier countries through the diffusion of better technologies to laggard countries. This effect is likely to differ according to the distance from the frontier country. Finally, the role of productivity patterns (Total Factor Productivity) and energy prices dynamics is assessed. Results based on the European NAMEA (National Accounting Matrix including Environmental Accounts) further merged with sector accounts highlight significant spillovers from leaders in emission efficiency and a general tendency to converge for laggard countries and sectors (except for NMVOC emission efficiency). Energy prices weakly induce improvements in emission efficiency, with the effect being generally stronger for sectors and countries farther away from the emission efficiency frontier. Finally, total factor productivity (TFP) is strongly correlated with emission efficiency while the distance from TFP frontier significantly harms emission efficiency growth. |
| Keywords: | patents, CDM model, eco-innovation, crowding out |
| JEL: | Q55 L60 O30 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:ial:wpaper:3&r=eff |
| By: | Marco Corsino; Enrico Zaninotto |
| Abstract: | Productive efficiency in hotels varies greatly. Based on a large dataset on the hotel industry in an Italian region, a two-stage approach was used, first to distinguish the component of inefficiency arising from external factors, linked to destination, and then to isolate the role that firm-level variables play on hotel efficiency. Stage 1 was carried out with non-parametric frontier analysis; stage 2 was based on an econometric model which regresses inefficiency scores on a set of firm-level variables. Investment behavior was found to play an important role, and family management had a negative influence on productive efficiency. |
| Keywords: | Efficiency; Data Envelopment Analysis (DEA); Two-stage estimation; Hotel industry; Managerial practices |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:trt:disawp:2012/03&r=eff |
| By: | Allen, Summer L.; Qaim, Matin |
| Abstract: | National governments, especially in sub-Saharan Africa, have limited budgets and are forced to make difficult funding decisions regarding the provision of social services and the support of agricultural programs. These provisions can play a critical role in rural incomes and agricultural production but due to data constraints, the effects of different types of social services on agricultural productivity in this region have not been analyzed in detail. This research provides indication that certain types of social services can influence agricultural production efficiency using the currently available data and multiple empirical methods. Specifically, it estimates the role of social services in the efficiency of input use for agricultural production, using both Stochastic Frontier Analysis and a Structural Equation Model. Ultimately, our conclusions are substantially limited by data constraints, but provide some indication that certain types of social services can influence agricultural production efficiency for a select set of African countries |
| Keywords: | Cross-country studies, Stochastic, efficiency analysis, public expenditure, |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1173&r=eff |
| By: | Gómez-Antonio, Miguel; Fingleton, Bernard |
| Abstract: | In this paper we examine whether variations in the level of public capital across Spain's Provinces affected productivity levels over the period 1996-2005. The analysis is motivated by contemporary urban economics theory, involving a production function for the competitive sector of the economy ('industry') which includes the level of composite services derived from 'service' firms under monopolistic competition. The outcome is potentially increasing returns to scale resulting from pecuniary externalities deriving from internal increasing returns in the monopolistic competition sector. We extend the production function by also making (log) labour efficiency a function of (log) total public capital stock and (log) human capital stock, leading to a simple and empirically tractable reduced form linking productivity level to density of employment, human capital and public capital stock. The model is further extended to include technological externalities or spillovers across provinces. Using panel data methodology, we find significant elasticities for total capital stock and for human capital stock, and a significant impact for employment density. The finding that the effect of public capital is significantly different from zero, indicating that it has a direct effect even after controlling for employment density, is contrary to some of the earlier research findings which leave the question of the impact of public capital unresolved. |
| Keywords: | Public capital, urban economics, spatial econometrics, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:edn:sirdps:247&r=eff |
| By: | Axel Dreher; Pierre-Guillaume Méon; Friedrich Schneider |
| Abstract: | This paper assesses the relationship between institutions, output, and productivity when official output is corrected for the size of the shadow economy. Our results confirm the usual positive impact of institutional quality on official output and total factor productivity, and its negative impact on the size of the underground economy. However, once output is corrected for the shadow economy, the relationship between institutions and output becomes weaker. The impact of institutions on total (“corrected”) factor productivity becomes insignificant. Differences in corrected output must then be attributed to differences in factor endowments. These results survive several tests for robustness. |
| Keywords: | shadow economy; income; aggregate productivity; development accounting |
| JEL: | O11 O17 O47 O50 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:sol:wpaper:2013/118565&r=eff |
| By: | Zaeske, Andrew (CERE, Centre for Environmental and Resource Economics) |
| Abstract: | In the United States freshwater withdrawals for agriculture account for 80% of all out of stream water withdrawals from 1985 to 2005. To assess what drives water use in agriculture, we use the two error stochastic frontier analysis model of Battese and Coelli (1995) to estimate a translog production frontier for agriculture at the state level. The inclusion of non-negative technical inefficiency effects allows us to account for additional characteristics in our assessment of production inefficiency. The average marginal value of irrigation is $380, while we fi nd that on average $1 of intermediate inputs provides $0.96 of final output. These results are driven by a small subset of states with large negative values, indicating persistent misallocation of resources. The inefficiency effects regression finds that government subsidies increase in value of output of 0:083 per real dollar of subsidies and that that shifts from larger acreage farms to lower acreage ones will generally be efficiency increasing. This analysis highlights differences in water use and how they can have major implications for farm policy as a whole. Of particular note is the measured positive correlation between having a negative marginal product of intermediates and having a positive marginal product of irrigation, which suggests that shifts in inputs from intermediates to irrigation are a ripe target for efficiency gains in many states. |
| Keywords: | agriculture; water use |
| JEL: | Q25 |
| Date: | 2012–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:slucer:2012_011&r=eff |
| By: | Dan Corry; Anna Valero; John Van Reenen |
| Abstract: | A common view is that the performance of the UK economy between 1997 and 2010 under Labour was very weak and that the current economic problems are a consequence of poor policies in this period. In this report, we analyse the historical performance of the UK economy since 1997 compared with other major advanced economies and with performance prior to 1997, notably the years of Conservative government, 1979-97. We focus on measures of business performance, especially productivity growth. This is a key economic indicator as in the long run, productivity determines material wellbeing - wages and consumption. Productivity determines the size of the "economic pie" available to the citizens of a country. |
| Keywords: | UK economic performance, productivity, fiscal policy, Labour government |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepcnp:366&r=eff |
| By: | Fernando Aragon (Simon Fraser University); Juan Pablo Rud (Royal Holloway University of London) |
| Abstract: | Most modern mines in the developing world are located in rural areas, where agriculture is the main source of livelihood. This creates the potential of negative spillovers to farmers through competition for key inputs (such as land) and environmental pollution. To explore this issue, we examine the case of gold mining in Ghana. Through the estimation of an agricultural production function using household level data, we find that mining has reduced agricultural productivity by almost 40%. This result is driven by polluting mines, not by input availability. Because of its crowding out effects on agriculture, we find that the mining activity is associated with an increase in poverty, child malnutrition and respiratory diseases. A simple cost-benefit analysis shows that the fiscal contribution of mining would not have been enough to compensate affected populations. |
| Keywords: | Natural resources; Mining; Pollution |
| JEL: | O13 Q11 Q33 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:sfu:sfudps:dp12-08&r=eff |
| By: | Gruere, Guillaume P.; Sun, Yan |
| Abstract: | While a number of empirical studies have demonstrated the role of Bt cotton adoption in increasing Indian cotton productivity at the farm level, there has been questioning around the overall contribution of Bt cotton to the average cotton yield increase observed these last ten years in India. This study examines the contribution of Bt cotton adoption to long- term average cotton yields in India using a panel data analysis of production variables in nine Indian cotton-producing states from 1975 to 2009. The results show that Bt cotton contributed 19 percent of total yield growth over time, or between 0.3 percent and 0.4 percent per percentage adoption every year since its introduction. Besides Bt cotton, the use of fertilizer and the increased adoption of hybrid seeds appear to have contributed to the yield increase over time. However, if official Bt cotton adoption contributed to increased yield after 2005, unofficial Bt cotton might also have been part of the observed increase of yields starting in 2002, the year of its official introduction in India. |
| Keywords: | Bt-cotton, Panel data, multiple imputation, |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1170&r=eff |
| By: | Miguel Manjón (Universitat Rovira i Virgili); Juan A. Mañez (Universitat de València); María E. Rochina-Barrachina (Universitat de València); Juan A. Sanchis-Llopis (Universitat de València) |
| Abstract: | Self-selection and learning-by-exporting are the main explanations for the higher productivity of exporting firms. But, whereas evidence on self-selection is largely undisputed, results on learning-by-exporting are mixed and far from conclusive. However, recent research (De Loecker, 2010) has shown that the conclusions from previous learning-by-exporting studies may have been driven by strong assumptions about the evolution of productivity and the role of export status. Relaxing these assumptions turns out to be critical to find evidence of learning-byexporting in a representative sample of Spanish manufacturing firms. Our results indicate that the yearly average gains in productivity are around 3% for at least four years. |
| Keywords: | learning-by-exporting, productivity |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:eec:wpaper:1208&r=eff |
| By: | Allen, Summer L.; Badiane, Ousmane; Ulimwengu, John M. |
| Abstract: | In an effort to inform strategic options to improve agricultural productivity, we examine the impact of social service expenditures on the marginal productivity of agricultural inputs. Increasing agricultural productivity is often advocated as a way to reduce poverty, especially in sub-Saharan Africa, where many people still rely on agriculture as their main source of income. Unfortunately, limited national budgets are often focused on meeting short-term needs rather than on making longer-term, growth-enhancing investments in agriculture and rural areas. Using Tanzania as a case study, this research investigates the direct and indirect impacts of district-level health and education expenditures on marginal productivities of agricultural inputs through education and health outcomes. This approach uses recently-released data for Tanzania and health and education spending data as well as an innovative combination of approaches including a general covariance structure model and a mixed linear model to allow for district-level heterogeneity. Our results suggest a significant and nonlinear relationship between social outcomes and social expenditures and point to the importance of these outcomes in productivity. Marginal productivities of inputs are significant and confirm the validity of a heterogeneous technology approach. As expected, labor productivity, in particular, responds significantly to health and education outcomes. The findings also point to the importance of controlling for intra-country socioeconomic and agro-climatic heterogeneity. |
| Keywords: | marginal productivity, social expenditure, state variables, |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1172&r=eff |
| By: | David Albouy; Gabriel Ehrlich |
| Abstract: | We present the first nationwide index of directly-measured land values by metropolitan area and investigate their relationship with housing prices. Construction prices and geographic and regulatory constraints are shown to increase the cost of housing relative to land. On average, approximately one-third of housing costs are due to land, with an increasing share in higher-value areas, implying an elasticity of substitution between land and other inputs of about one-half. Conditional on land and construction prices, housing productivity is relatively low in larger cities. The increase in housing costs associated with greater regulation appears to outweigh any benefits from improved quality-of-life. |
| JEL: | D24 R31 R52 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18110&r=eff |
| By: | Kox, Henk L.M. |
| Abstract: | The paper tests the role of agglomeration effects on the export decision of services firms. Recent theories on trade with heterogeneous firms predict that export participation goes along with sunk market-entry costs. Only the more productive firms will be able to overcome these sunk costs. This leads to a process of - ex ante - self selection. These predictions are tested for the services industry, with due account for the possible role of agglomeration effects in large-city areas. Standard empirical tests of the new trade models consistently find productivity-based ex ante self selection by exporters, and this effect is mostly explained by unobserved sunk entry costs that exporters have to absorb in new foreign markets. Recent research by urban economists (e.g. Combes et al., 2012) suggests, however, that operating in large-city areas also goes along with positive productivity sorting. Ignoring this leads to upwardly biased estimates of the effect of foreign market entry costs. A large set of micro-data for establishments in Dutch services is used to investigate this hypothesis. I find evidence that positive productivity self-selection is based on the combined effects of agglomeration and anticipated market-entry cost for export starters. This effect is strongest in markets with more or less homogeneous products. I also find evidence that the productivity self-selection effect (of exporters compared to non-traders) is stronger in non-urban areas and smaller agglomerations. |
| Keywords: | services; export; heterogeneous firms; agglomeration effects; productivity |
| JEL: | L8 F12 R12 D4 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39127&r=eff |
| By: | Paz, Lourenco |
| Abstract: | The literature concerning the effect of tariffs on the inter-industry wage premium has not addressed the role of total factor productivity (TFP) in determining both the wage premium and tariffs. This omission invalidates the use of the pre-reform tariff level as an instrument for the change in tariffs. Based on an analysis of Colombian data, I find that including TFP in the estimated model of the effects of tariffs on the wage premium leads to a 36% decrease in the effect of tariffs on the inter-industry wage premium relative to the model that omits TFP. More specifically, a ten percentage point decrease in tariffs reduces the wage premium by 1.1%. This finding suggests the importance of using policies that boost productivity to offset the effect of tariffs on the wage premium. |
| Keywords: | inter-industry wage premium; trade liberalization; productivity; Colombia |
| JEL: | F16 J3 O15 |
| Date: | 2012–01–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39024&r=eff |
| By: | Bryceson, Deborah; Sarkar , Prabirjit; Fennel, Shailaja; Singh, Ajit |
| Abstract: | A major purpose of this paper is to examine the effects of poor governance or ‘state fragility’ in African countries on their overall economic and agrarian performance. The results of our econometric analysis show that a higher level of public security is conducive to lower levels of conflict, whether of an ethnic, religious and regional nature. It also corresponds with greater agricultural value-added per capita. The analysis further indicates that trade openness and aid do not have a substantial impact on agricultural development. Our institutional and historical examination of the structural adjustment programmes in African countries suggest that African agriculture’s poor performance is not necessarily due to the negative influence of African governments, but could also, in large part, be attributed to the policies advocated by the international financial institutions and donor countries. The resolution of the problems associated with these policies lies in improving the ability of African farmers to benefit from new agrarian technologies that raise staple food productivity and thereby enhance food security and national stability. The paper also provides, inter alia, a nuanced analytical description, based upon available aggregate statistics, of the short- and long-term performance of African economies and their agricultural sectors during the last 25 years. |
| Keywords: | African agriculture; Poor governance; State fragility; Donor policies |
| JEL: | Q1 O55 O15 O13 Q18 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39053&r=eff |
| By: | Claudia M. Buch; Estaban Prieto |
| Abstract: | Insufficient capital buffers of banks have been identified as one main cause for the large systemic effects of the recent financial crisis. Although higher capital is no panacea, it yet features prominently in proposals for regulatory reform. But how do increased capital requirements affect business loans? While there is widespread belief that the real costs of increased bank capital in terms of reduced loans could be substantial, there are good reasons to believe that the negative real sector implications need not be severe. In this paper, we take a long-run perspective by analyzing the link between the capitalization of the banking sector and bank loans using panel cointegration models. We study the evolution of the German economy for the past 60 years. We find no evidence for a negative impact of bank capital on business loans. |
| Keywords: | Bank capital, business loans, cointegration |
| JEL: | G2 E5 C33 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:iaw:iawdip:84&r=eff |
| By: | McBride, William D.; Greene, Catherine R.; Ali, Mir B.; Foreman, Linda F. |
| Abstract: | Results from long-term experimental trials suggest that similar yields and lower costs are possible from organic compared with conventional field crop production, but there is little information about the relative costs and returns on commercial farms. This study examines the structure and profitability of commercial wheat production using a nationwide survey of wheat producers for 2009 that includes a targeted sample of organic growers. Treatment-effect models were specified to isolate the impact of choosing the organic approach on various levels of wheat production costs. Average organic wheat yields were much lower than for conventional wheat, but per acre operating plus capital costs were also lower. Estimated operating costs per bushel for organic wheat were lower than for conventional wheat, but operating plus capital costs and total economic costs were about $2 to $4 per bushel higher. The average organic price premium in 2009 was $3.79 per bushel, enough to cover the difference in operating plus capital costs of organic versus conventional wheat production, but was short of the difference in total economic costs |
| Keywords: | wheat, organic, production costs, profitability, Crop Production/Industries, Farm Management, Production Economics, |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea12:123835&r=eff |
| By: | Greta Falavigna (Ceris - Institute for Economic Research on Firms and Growth,Turin,Italy); Roberto Ippoliti (IEL International Program in Institutions, Economics and Law) |
| Abstract: | Taking human experimentation into account, this work aims at estimating the relationship between transaction costs, which are related to the protection system of patients’ rights, and localization of pharmaceutical industry’s testing phase. Assuming that the competitiveness of the protection system is based on the time required to obtain an authorization or an experimental activity, pharmaceutical clinical research should be positively affected by a process aimed at internalizing the review process, if efficient. By analyzing said system with operational research, this paper concludes suggesting the potentiality of a competitive system of reviewers, that is to say, the efficiency of that internalization process is performed by medical centers in which the experimental treatments are proposed to subjects. |
| JEL: | I18 L51 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:csc:cerisp:201204&r=eff |