New Economics Papers
on Efficiency and Productivity
Issue of 2007‒01‒13
nine papers chosen by

  1. Broadcasting Productivity Growth in the UK By David Paton; Leighton Vaughan Williams
  2. Imports and Productivity By Laszlo Halpern; Miklos Koren; Adam Szeidl
  3. The Role of the Structural Transformation in Aggregate Productivity By Margarida Duarte; Diego Restuccia
  4. Using the Asymptotically Ideal Model to estimate the impact of knowledge on labour productivity: An application to Taiwan in the 1990s. By Chia-Lin CHANG; Stéphane ROBIN
  5. Urbanization, Productivity and Innovation: Evidence from Investment in Higher Education By Roland Andersson; John Quigley; Mats Wilhelmsson
  6. Does services liberalization benefit manufacturing firms ? Evidence from the Czech Republic By Arnold, Jens; Javorcik, Beata S.; Mattoo, Aaditya
  7. Financial Independence of Local Productivity Centers By Kenji Iwata
  8. Finance and hunger : empirical evidence of the agricultural productivity channel By Claessens, Stijn; Feijen, Erik
  9. Stories about productivity By John Quiggin

  1. By: David Paton (Nottingham University Business School); Leighton Vaughan Williams (Nottingham Business School)
    Abstract: In this study, we use enterprise-level data to calculate estimates of labour productivity growth in the UK broadcasting sector between 1999 and 2004 and TFP growth between 1998 and 2004. We present estimates using both gross output and gross value added. We also present TFP estimates separately for the TV and radio sectors and broken down by employment class size and also the decomposition of TFP into technical change and efficiency catch-up. All our estimates suggest that the broadcasting sector has experienced positive productivity growth over recent years. Productivity growth is found across the size distribution of firms. Technical change appears to have contributed most to productivity growth, although we also observe positive growth in efficiency catch-up. The finding of positive productivity growth over the period appears generally to be robust to alternative estimation procedures, to alternative price deflators (although this has an impact on the magnitude of the estimates) and to separate estimation of the TV and Radio sectors.
    Keywords: broadcasting, efficiency, productivity growth
    JEL: D24 J24 L82
    Date: 2007–01–08
  2. By: Laszlo Halpern (Macroeconomics Institute of Economics of Hungarian Academy of Sciences); Miklos Koren; Adam Szeidl
    Abstract: What is the effect of imports on productivity? To answer this question, we estimate a structural model of producers using product-level import data for a panel of Hungarian manufacturing firms from 1992 to 2001. In our model with heterogenous firms, producers choose to import or purchase domestically varieties of intermediate inputs. Imports affect firm productivity through expanding variety as well as improved input quality. The model leads to a production function where the total factor productivity of a firm depends on the share of inputs imported. To estimate this import-augmented production function, we extend the Olley and Pakes (1996) procedure for a setting with an additional state variable, the number of input varieties imported. Our results suggest that the role of imports is both statistically and economically significant. Imports are responsible for 30% of the growth in aggregate total factor productivity in Hungary during the 1990s. About 50% of this effect is through imports advancing firm level productivity, while the remaining 50% comes from the reallocation of capital and labor to importers.
    Keywords: imports, intermediate inputs, productivity
    JEL: F12 F14 L25
    Date: 2006–12–03
  3. By: Margarida Duarte; Diego Restuccia (Department of Economics University of Toronto)
    Abstract: In this paper, we document the reallocation of employment over time between agriculture, manufacturing, and services (the process of structural transformation) and the growth rate of sectoral labor productivity across countries. We find that countries are going through a remarkably similar process of structural transformation, although with a substantial lag for some countries. We investigate whether sectoral differences in labor productivity can account for differences in the process of structural transformation and aggregate productivity across countries. We consider a model of the structural transformation and calibrate it to the experience of the United States. We use the model to measure sectoral labor productivity differences across countries and show that these differences are large and systematic both at a point in time and over time. In particular, labor productivity differences are large in agriculture and services and smaller in manufacturing. We show that the implied sectoral labor productivity differences help explain the process of structural transformation and aggregate productivity experiences across countries
    Keywords: Productivity, employment, sectors, countries.
    JEL: O1 O4
    Date: 2006–12–03
  4. By: Chia-Lin CHANG; Stéphane ROBIN
    Abstract: This paper examines the impact of embodied and disembodied knowledge on labour productivity in Taiwan’s manufacturing industry, using the Asymptotically Ideal Model. The model is estimated on a panel of 27,754 firms observed from 1992 to 1995, using three estimations procedures: fixed-effect regression, random-effect GLS, and Hausman-Taylor estimation. Our findings show that, in traditional industries, labour productivity is mostly driven by embodied knowledge, whereas in high-tech industries, labour productivity depends on both embodied and disembodied knowledge. The latter result may be the consequence of the Industrial Upgrading Statute implemented in Taiwan after 1991.
    Keywords: Asymptotically Ideal Model; Disembodied Knowledge; Embodied Knowledge; Labour Productivity; Newly Industrialized Countries.
    JEL: C51 J24 L60 O38
    Date: 2006
  5. By: Roland Andersson (Royal Institute of Technology, Sweden); John Quigley (University of California, Berkeley); Mats Wilhelmsson (Royal Institute of Technology, Sweden)
    Abstract: During the past fifteen years, Swedish government policy has decentralized post-secondary education throughout the country. We investigate the economic effects of this decentralization policy on the level of productivity and innovation and their spatial distribution in the Swedish economy. We analyze productivity, measured as output per worker at the level of the locality, for 284 Swedish communities during a 14 year period, and innovation, measured by commercial patents awarded in 100 Swedish labor market areas during an 8 year period. These economic outcomes, together with data documenting the decentralization of university-based researchers, permit us to estimate the effects of exogenous changes in educational policy upon increases in productivity and the locus of innovative activity. We find important and significant effects of this policy upon economic output and the locus of knowledge production, suggesting that the decentralization has affected regional development through local innovation and increased creativity. Moreover, our evidence suggests that aggregate productivity was increased by the deliberate policy of decentralization.
    Date: 2006–07–13
  6. By: Arnold, Jens; Javorcik, Beata S.; Mattoo, Aaditya
    Abstract: While there is considerable empirical evidence on the impact of liberalizing trade in goods, the effects of services liberalization have not been empirically established. Using firm-level data from the Czech Republic for the period 1998-2003, this study examines the link between services sector reforms and the productivity of domestic firms in downstream manufacturing. Several aspects of services reform are considered and measured, namely, the increased presence of foreign providers, privatization, and enhanced competition. The manufacturing-services linkage is measured using information on the degree to which manufacturing firms in a particular industry rely on intermediate inputs from specific services sectors. The econometric results lead to two conclusions. First, the study finds that services policy matters for the productivity of manufacturing firms relying on services inputs. This finding is robust to several econometric specifications, including controlling for unobservable firm heterogeneity and for other aspects of openness. Second, it finds evidence that opening services sectors to foreign providers is a key channel through which services liberalization contributes to improved performance of downstream manufacturing sectors. This finding is robust to instrumenting for the extent of foreign presence in services industries. As most barriers to foreign investment today are not in goods but in services sectors, the findings may strengthen the argument for reform in this area.
    Keywords: Banks & Banking Reform,Knowledge Economy,Education for the Knowledge Economy,Economic Theory & Research,Commodities
    Date: 2007–01–01
  7. By: Kenji Iwata
    Abstract: After the Second World War, the productivity movement was spread out in Western European countries and in Japan. After that, the productivity movement was developed also in developing countries, e.g. India, and in some developed countries such as Germany and Italy until today. Japan Productivity Center (JPC) was established in 1955 and after that its local organizations were founded. So that JPC and its local organizations could have continued to exist for half a century, it is necessary for them to continually contribute to society. Its proof lies in the fact that the local organizations could be operated independently with smaller amount of financial support from JPC. I studied the current status of income and expenditure of Kansai Productivity Center (KPC), one of the local productivity centers of JPC. The result of my study clearly shows that KPC has been run with smaller amount of financial support from JPC.
    Keywords: Productivity movementD Local Productivity CenterD Financial IndependenceD Financial support.
    Date: 2007–01
  8. By: Claessens, Stijn; Feijen, Erik
    Abstract: Using cross-country and panel regressions, the authors show that financial sector development significantly reduces undernourishment (hunger), largely through gaining farmers and others access to productivity-enhancing equipment, translating into beneficial income and general effects. They show specifically that a deeper financial sector leads to higher agricultural productivity, including higher cereal yields, through increased fertilizer and tractor use. Higher productivity in turn leads to lower undernourishment. The results are robust to various specifications and econometric tests and imply that a 1 percentage point increase in private credit to GDP reduces undernourishment by 0.22-2.45 percentage points, or about one-quarter the impact of GDP per capita.
    Keywords: Economic Theory & Research,Rural Poverty Reduction,Pro-Poor Growth and Inequality,Inequality
    Date: 2006–12–01
  9. By: John Quiggin (Department of Economics, University of Queensland)
    Abstract: In this paper, it is argued that, given its relatively short duration and high year-to-year variability, the MFP data set does not contain enough information to allow clear statistical discrimination between competing hypotheses. As a result of this lack of information, combined with the human predilection for observing patterns, a range of alternative stories, each of which may be supported by an appropriate interpretation of the data, has been produced. Three such stories are described here. The first is the ÔNew EconomyÕ story put forward by Parham and others. The second story agrees with the first regarding the 1990s, but interprets the subsequent decline in productivity growth as the result of a failure to pursue microeconomic reform with sufficient vigour. The third story rejects the idea of a productivity miracle in the 1990s and argues instead that productivity growth rates experienced a sharp decline at the end of the postwar ÔGolden AgeÕ around 1970, and that this decline has been sustained, although with fluctuations around the trend.
    Date: 2006–03

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