nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2007‒07‒13
nine papers chosen by
Angelo Zago
University of Verona

  1. Exports and Productivity in Germany By Joachim Wagner
  2. Productivity and Size of the Export Market Evidence for West and East German Plants, 2004 By Joachim Wagner
  3. Exporting, Linkages and Productivity Spillovers from Foreign Direct Investment By Girma, Sourafel; Görg, Holger; Pisu, Mauro
  4. What When Space Matters Little For Firm Productivity? A multilevel analysis of localised knowledge externalities By Otto Raspe; Frank van Oort
  5. Efficiency and Price Effects of Horizontal Bank Mergers By John K. Ashton; Khac Pham
  6. Does decentralization improve the efficiency in the allocation of public investment? Evidence from Spain By Alejandro Esteller; Albert Solé
  7. How Does Outsourcing Affect Performance Dynamics? Evidence from the Automobile Industry By Sharon Novak; Scott Stern
  8. Evaluating the Impact of Public Subsidies on a Firms Performance: a Quasi-experimental Approach By Nestor Duch Brown; Daniel Montolio Estivill; Mauro Mediavilla
  9. Performance and corporate governance in microfinance institutions By Mersland, Roy; Strøm, Reidar Øystein

  1. By: Joachim Wagner (University of Lueneburg, Institute of Economics; Institute for the Study of Labor (IZA), Bonn; Max Planck Institute of Economics, Jena)
    Abstract: Using unique recently released nationally representative high-quality longitudinal data at the plant level, this paper presents the first comprehensive evidence on the relationship between exports and productivity for Germany, a leading actor on the world market for manufactured goods. It applies and extends the now standard approach from the international literature to document that the positive productivity differential of exporters compared to non-exporters is statistically significant, and substantial, even when observed firm characteristics and unobserved firm specific effects are controlled for. For West German plants (but not for East German plants) some empirical evidence for self-selection of more productive firms into export markets is found. There is no evidence for the hypothesis that plants which start to export perform better in the three years after the start than their counterparts which do not start to sell their products on the world market. Results for West Germany support the hypothesis that the productivity differential between exporters and non-exporters is at least in part the result of a market driven selection process in which those export starters that have low productivity at starting time fail as a successful exporter in the years after the start, and only those that were more productive at starting time continue to export.
    Keywords: Exports, productivity, micro data, Germany
    JEL: F14 D21
    Date: 2007–07–02
    URL: http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2007-026&r=eff
  2. By: Joachim Wagner (University of Lueneburg, Institute of Economics; Institute for the Study of Labor (IZA), Bonn; Max Planck Institute of Economics, Jena)
    Abstract: Using unique recently released nationally representative high-quality data at the plant level, this paper presents the first comprehensive evidence on the relationship bet ween productivity and size of the export market for Germany, a leading actor on the world market for manufactured goods. It documents that firms that export to countries inside the euro-zone are more productive than firms that sell their products in Germany only, but less productive than firms that export to countries outside the euro-zone, too. This is in line with the hypothesis that export markets outside the euro-zone have higher entry costs that can only by paid by more productive firms.
    Keywords: Exports, productivity, micro data, Germany
    JEL: F14 D21
    Date: 2007–07–02
    URL: http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2007-028&r=eff
  3. By: Girma, Sourafel; Görg, Holger; Pisu, Mauro
    Abstract: In this paper we analyse productivity spillovers from foreign direct investment using firm level panel data UK manufacturing industries from 1992 to 1999. We investigate spillovers through horizontal, backward and forward linkages, distinguish spillovers from export oriented vs domestic market oriented FDI, and allow for differing effects depending on domestic firms’ export activities. The results suggest that the mechanisms through which spillovers affect domestic firms are very complex and that there are substantial differences in spillover benefits for domestic exporters and non-exporters, and from different types of inward investment.
    Keywords: absorptive capacity; exporting; foreign direct investment; linkages; productivity spillovers
    JEL: F1 F2
    Date: 2007–07
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:6383&r=eff
  4. By: Otto Raspe; Frank van Oort
    Abstract: This paper contributes to the debate on localized knowledge externalities as potential source for firm productivity gains. We apply multilevel analysis to link firm productivity (and growth) to knowledge intensive spatial contexts in the Netherlands. If localized knowledge externalities are important, then firms are hypothesised to co-locate in order to capitalize on each other's knowledge stocks. We conceptualise the regional knowledge base by three dimensions: local 'research and development' intensity, local 'innovativeness', and the characterization of locations by a ‘knowledge workers’ dimension (based on ICT use, educational level, communicative and creative skills). Controlling for firm's heterogeneity, we find a relatively small spatial effect: regional characteristics contribute for only a few percents to firm productivity. The regional intensity of 'innovation' most significantly contributes to this effect. We do not find a contextual spatial effect for productivity growth. These results suggest that the territorial dimension of knowledge externalities should not be exaggerated.
    Keywords: productivity, multilevel analysis, localized knowledge externalities, Netherlands
    Date: 2007–06
    URL: http://d.repec.org/n?u=RePEc:egu:wpaper:0706&r=eff
  5. By: John K. Ashton (Centre for Competition Policy, University of East Anglia); Khac Pham (Centre for Competition Policy, University of East Anglia)
    Abstract: This study provides an empirical assessment of the efficiency and interest rate changes occurring during 61 UK retail bank mergers. Key findings of the work include the general efficiency enhancing influence of UK bank mergers and the limited effect of merger on retail interest rates. Furthermore, different banking products appear to be influenced differently by mergers. It is proposed that future assessments of bank competition and mergers require an accommodation of different types of bank customer.
    Keywords: Retail banking, mergers, efficiency and price effects
    JEL: G14 G21
    Date: 2007–06
    URL: http://d.repec.org/n?u=RePEc:ccp:wpaper:wp07-09&r=eff
  6. By: Alejandro Esteller (Institut d'Economia de Barcelona (IEB); Universitat de Barcelona (UB)); Albert Solé (Institut d'Economia de Barcelona (IEB); Universitat de Barcelona (UB))
    Abstract: The well-known "Decentralization Theorem" (Oates, 1972) establishes the superiority of decentralized public provision over the centralized case, which is not so sensitive to the diversity of expenditure needs among territories. We test this hypothesis using a unique Spanish database that provides information on road and educational infrastructure investment and capital stocks by region both before and after the decentralization of such responsibilities. We find that investment in both categories is much more sensitive to regional output and to infrastructure users and costs when sub-central governments have the responsibility over such services.
    Keywords: Decentralization, Growth, Human capital, Roads
    JEL: D72 H54 H72 H77 I20
    URL: http://d.repec.org/n?u=RePEc:ieb:wpaper:357450art73&r=eff
  7. By: Sharon Novak; Scott Stern
    Abstract: This paper examines the impact of vertical integration on the dynamics of performance over the automobile product development lifecycle. Building on recent work in organizational economics and strategy, we evaluate the relationship between vertical integration and different performance margins. Outsourcing facilitates access to cutting-edge technology and the use of high-powered performance contracts. Vertical integration allows firms to adapt to unforeseen contingencies and customer feedback, maintain more balanced incentives over the lifecycle, and develop firm-specific capabilities over time. Together, these effects highlight a crucial tradeoff: while outsourcing is associated with higher levels of initial performance, vertical integration will be associated with performance improvement over the product lifecycle. We test these ideas using detailed data from the luxury automobile segment, establishing three key results. First, initial performance is declining in the level of vertical integration. Second, the level of performance improvement is significantly increasing in the level of vertical integration. Finally, the impact of vertical integration on alternative performance margins is mediated by the level of pre-existing capabilities, by the salience of opportunities to access external technology leaders, and by the scope for learning over the product lifecycle. Together, the findings highlight a strategic governance tradeoff between short-term performance and the evolution of firm capabilities.
    JEL: L24 L25 L62 O32
    Date: 2007–07
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:13235&r=eff
  8. By: Nestor Duch Brown; Daniel Montolio Estivill; Mauro Mediavilla (Universitat de Barcelona)
    Abstract: Many regional governments in developed countries design programs to improve the competitiveness of local firms. In this paper, we evaluate the effectiveness of public programs whose aim is to enhance the performance of firms located in Catalonia (Spain). We compare the performance of publicly subsidised companies (treated) with that of similar, but unsubsidised companies (non-treated). We use the Propensity Score Matching (PSM) methodology to construct a control group which, with respect to its observable characteristics, is as similar as possible to the treated group, and that allows us to identify firms which retain the same propensity to receive public subsidies. Once a valid comparison group has been established, we compare the respective performance of each firm. As a result, we find that recipient firms, on average, change their business practices, improve their performance, and increase their value added as a direct result of public subsidy programs.
    Keywords: public policy, evaluation studies, firm performance, propensity score matching
    JEL: H32 H25 L53 L25
    Date: 2007
    URL: http://d.repec.org/n?u=RePEc:bar:bedcje:2007181&r=eff
  9. By: Mersland, Roy; Strøm, Reidar Øystein
    Abstract: We trace the relationship between firm performance and corporate governance in microfinance institutions (MFI) utilising a self constructed global data set on MFIs, collected from third-party rating agencies. We study the effect of board characteristics, ownership type, competition and regulation on the MFI's outreach to poor clients and its financial performance. The results show that split roles of CEO and chairman, a female CEO, and competition are important explanations. Larger board size decreases the average loan size while individual guaranteed loan increases it. No difference between nonprofit organisations and shareholder firms in financial performance and outreach is found.
    Keywords: Microfinance organizations; governance; performance
    JEL: G32 G21 G30 O16 J23
    Date: 2007–06
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:3887&r=eff

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