nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2006‒05‒27
four papers chosen by
Angelo Zago
Universita degli Studi di Verona

  1. Technical Change and Total Factor Productivity Growth for Chinese Provinces: A Panel Data Analysis By Alice Shiu; Almas Heshmati
  2. Skill dispersion and firm productivity; an analysis with employer-employee matched data By Susanna Iranzo; Fabiano Schivardi; Elisa Tosetti
  3. Foreign Direct Investment and Technology Spillovers: Evidence from The Indian Manufacturing Sector By Sasidharan, Subash
  4. Does access to credit improve productivity ? Evidence from Bulgarian firms By Love, Inessa; Gatti, Roberta

  1. By: Alice Shiu (Hong Kong Polytechnic University); Almas Heshmati (TEPP, Seoul National University, RATIO Institute and IZA Bonn)
    Abstract: We present in this paper the panel econometrics estimation approach of measuring the technical change and total factor productivity (TFP) growth of 30 Chinese provinces during the period of 1993 to 2003. The random effects model with heteroscedastic variances has been used for the estimation of the translog production functions. Two alternative formulations of technical change measured by the single time trend and the general index approach are used. Based on the measures of technical change, estimates of TFP growth could be obtained and its determinants were examined using regression analysis. The parametric TFP growth measure is compared with the non-parametric Solow residual. TFP has recorded positive growth for all provinces during the sample period. Regional breakdown shows that the eastern and central regions have higher average TFP growth when compared with the western region. Foreign direct investment (FDI) and information and communication technology (ICT) investment are found to be significant factors contributing to the TFP difference. While these two factors are found to have significant influence on TFP, their influence on production is relatively small compared to traditional inputs of production.
    Keywords: technical change, TFP growth, provinces, China, ICT, FDI, infrastructure
    JEL: C23 D24 E22 O18 O47
    Date: 2006–05
  2. By: Susanna Iranzo (University of Sidney); Fabiano Schivardi (Bank of Italy, Economic Research Department); Elisa Tosetti (Cambridge University)
    Abstract: We study the relation between workers’ skill dispersion and firm productivity using a unique dataset of Italian manufacturing firms from the early eighties to the late nineties with individual records on all their workers. Our measure of skill is the individual worker’s effect obtained as a latent variable from a wage equation. Estimates of a generalized CES production function that depends on the skill composition show that a firm’s productivity is positively related to skill dispersion within occupational status groups (production and non-production workers) and negatively related to skill dispersion between these groups. Consistently, the variance decomposition shows that most of the overall skill dispersion is within and not between firms. We find no change over time in the share of each component, in contrast with some evidence from other countries, based on less comprehensive data.
    Keywords: Matched data, Skills, Productivity, Segregation
    JEL: D24 J24 L23
    Date: 2006–02
  3. By: Sasidharan, Subash (Indian Institute of Technology)
    Abstract: During the recent period, we observe that many countries compete with each other to attract foreign investment. When MNCs invest in a host country, it is assumed that a part of their technology spills to the host country firms. But the empirical studies on spillover effects of FDI have failed to find robust empirical results about the possibility of positive spillover effects. This study is an attempt to empirically examine the spillover effects from the entry of foreign firms using firm level data of Indian manufacturing industries for the period 1994-2002. We consider both the horizontal and vertical spillover effects of FDI. Consistent with the findings of the previous studies, we find no evidence of significant horizontal spillover effects. In contrast, we find negative vertical spillover effects, although it is not statistically significant.
    Keywords: Foreign Direct Investment, Horizontal Spillover, Vertical Spillover, Panel Data
    JEL: F2 O1 O3 C5
    Date: 2006
  4. By: Love, Inessa; Gatti, Roberta
    Abstract: Although it is widely accepted that financial development is associated with higher growth, the evidence on the channels through which credit affects growth on the micro-level is scant. Using data from a cross section of Bulgarian firms, the authors estimate the impact of access to credit (as proxied by indicators of whether firms have access to a credit or overdraft facility) on productivity. To overcome potential omitted variable bias of OLS estimates, they use information on firms ' past growth to instrument for access to credit. The authors find credit to be positively and strongly associated with total factor productivity. These results are robust to a wide range of robustness checks.
    Keywords: Banks & Banking Reform,Economic Theory & Research,Investment and Investment Climate,Economic Growth,Financial Intermediation
    Date: 2006–05–01

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