New Economics Papers
on Efficiency and Productivity
Issue of 2008‒05‒10
twelve papers chosen by

  1. Productivity Change of UK Airports: 2000-2005 By Carlos Pestana Barros; Shunsuke Managi
  2. Firm Productivity and Exports: Evidence from Ethiopian manufacturing By Bigsten, Arne; Gebreeyesus, Mulu
  3. Employee Satisfaction, Firm Value and Firm Productivity By Roger Best
  5. Foreign Presence, Spillovers, and Productivity: Evidence from Ghana By Waldkirch, Andreas; Ofosu, Andra
  6. Productivity Drivers in Japanese Seaports By Carlos Pestana Barros; Shunsuke Managi
  7. Productivity Growth, Knowledge Flows, and Spillovers By Gustavo Crespi; Chiara Criscuolo; Jonathan E. Haskel; Matthew Slaughter
  8. Identification of Segments of Thermo Energy Plants with a Latent Class Model By Carlos Pestana Barros
  9. Law and Order Efficiency Measurement – A Literature Review By Miguel St. Aubyn
  10. Heterogeneity in Technical Efficiency of the French Urban Transport: 1995 to 2002 By Carlos Pestana Barros; Jean-Pascal Guironnet; Nicolas Peypoch; William Roy
  11. Information Technology, Research & Development, or Both? What Really Drives A Nation's Productivity By Francesco VENTURINI
  12. Spend more, get more? An iniquiry into English local government performance By Revelli Federico

  1. By: Carlos Pestana Barros; Shunsuke Managi
    Abstract: In this paper, the two innovative nonparametric models, the Luenberger productivity model and Luenberger–Hicks–Moorsteen productivity indicator are used to estimate the productivity of UK airports. These airports are ranked according to their total productivity for the period 2000- 2005 showing that the majority of UK airports are not improving their efficiency in the period. Economic implications arising from the study are derived.
    Keywords: productivity measurements; UK airports; data envelopment analysis; Luenberger productivity indicator and Luenberger–Hicks–Moorsteen productivity indicator.
    Date: 2008–04
  2. By: Bigsten, Arne (Department of Economics, School of Business, Economics and Law, University of Gothenburg); Gebreeyesus, Mulu (Department of Economics, School of Business, Economics and Law, University of Gothenburg)
    Abstract: This paper examines the causal relationship between exporting and productivity using a ten years long plant-level panel data set from an annual census of Ethiopian manufacturing, rarely available in the sub-Saharan Africa. We exploited its length to trace the trajectory of TFP and other productivity measures of groups of firms classified by their export history. We then tested learning-by-exporting using a one-step system-GMM approach with the export-status included directly in the production function. We addressed potential endogeneity problems by using instrumental variables, and also applied a matching analysis to address potential selection bias. We found strong evidence of not only self-selection but also learning-by-exporting. Depending on the specification previous exporting appears to have shifted the production function by 15-32 %. Exporters had on average three times more employees, and paid 1.6 times higher average wage than those of non-exporters.<p>
    Keywords: Productivity; exports; Ethiopia; manufacturing
    JEL: D21 F14 L60 O14
    Date: 2008–04–30
  3. By: Roger Best (University of Central Missouri)
    Abstract: We examine whether self-reported employee satisfaction is associated with higher firm valuation and productivity. Using a sample of firms from Fortune magazine’s list of "100 Best Companies to Work For", companies in which employees report high levels of satisfaction, we find that these firms have valuations that are significantly greater than both their respective industry medians and matched firms. The firms in our sample also exhibit greater levels of productivity and efficiency. Thus, successful efforts in increasing employee satisfaction appear to enhance overall firm productivity, which is subsequently rewarded by investors through higher equity values.
    Keywords: Employee satisfaction, firm value, firm productivity
    JEL: G30 G12 J41
    Date: 2008–05
  4. By: Jaan Masso; Priit Vahter
    Abstract: There is growing interest in modelling the relationship between innovation and productivity in developing and transition econo¬mies due to their attempts to establish knowledge-based economies and to increase business R&D. Our paper investigates whether there is a signi¬ficant relationship between technological innovation and pro¬ductivity in the manufacturing sector of Estonia. We use firm-level data for the analysis from two waves of Community Innovation Surveys (CIS3 and CIS4) from 1998–2000 and 2002–2004, which is then combined with financial data about firms from the Estonian Business Register in order to study the effect of innovation at higher leads. We apply a structural model that in¬volves a system of equations on innovation expenditure, inno¬vation outcome and productivity. Our results show that during 1998–2000 only product innovation increased productivity, while in 2002–2004 only process innovation had a positive effect on productivity. This can probably be explained by the different macroeconomic conditions in the two periods.
    Keywords: productivity; innovation; Estonia
    JEL: O31 O33 C31 O10
    Date: 2008
  5. By: Waldkirch, Andreas; Ofosu, Andra
    Abstract: This paper investigates the effect of foreign presence on the productivity of manufacturing industries in Ghana, using firm level panel data. We examine both labor and total factor productivity (TFP), which we compute using the Levinsohn and Petrin (2003) methodology. We control for a number of observed factors as well as unobserved heterogeneity in several dimensions. We find robust evidence that the presence of foreign firms in a sector has a negative effect on domestically owned, but a positive effect on most foreign owned firms. Unlike in recent work on China, it does not appear that the negative level effect is compensated for by a positive growth effect, at least not in any reasonable time period. This finding underscores that care must be exercised in extrapolating results from one country to others. We find no evidence of any wage effects.
    Keywords: Foreign Direct Investment; Productivity; Spillovers; Firm Level Data; Africa; Ghana
    JEL: O55 O24 F23
    Date: 2008–03
  6. By: Carlos Pestana Barros; Shunsuke Managi
    Abstract: This paper analyses efficiency drivers of a representative sample of Japanese seaports by means of the two-stage procedure proposed by Simar and Wilson (2007). In the first stage, the technical efficiency of seaports is estimated using several models of data envelopment analysis (DEA) that might be employed in order to establish which of them are most efficient. In the second stage, the Simar and Wilson (2007) procedure is used to bootstrap the DEA scores with a truncated bootstrapped regression to identify efficiency drivers. The policy implications of our findings are considered.
    Keywords: Seaports; Japan; Data Envelopment Analysis; Truncated Bootstrapped Regression.
    Date: 2008–02
  7. By: Gustavo Crespi; Chiara Criscuolo; Jonathan E. Haskel; Matthew Slaughter
    Abstract: This paper explores the role of knowledge flows and productivity growth by linking direct survey data on knowledge flows to firm-level data on TFP growth. Our data measure the information flows often considered important, especially by policy-makers, such as from within the firm and from suppliers, customers, and competitors. We examine (a) what are the empirically important sources of knowledge flows? (b) to what extent do such flows contribute to TFP growth? (c) do such flows constitute a spillover of free knowledge? (d) how do such flows correspond to suggested spillover sources, such as multinational or R&D presence? We find that: (a) the main sources of knowledge are competitors; suppliers; and plants that belong to the same business group ; (b) these three flows together account for about 50% of TFP growth; (c) the main "free" information flow spillover is from competitors; and (d) multinational presence contributes to this spillover.
    JEL: F23 O47 O57
    Date: 2008–04
  8. By: Carlos Pestana Barros
    Abstract: This paper identifies different groups in a cost function framework of thermo energy plants belonging to EDP-Electricity of Portugal. In particular, we have clustered the sample - comprising data for years 1987 to 2006 - into two groups. To do so, we have implemented a stochastic frontier latent class model, a procedure that also permits us to analyze also the efficiency of the thermo energy plants with respect to their own frontiers. The results reveal that some of the plants could improve their efficiency levels substantially.
    Keywords: cost efficiency; latent class model; thermo energy plants; stochastic frontier.
    Date: 2008–03
  9. By: Miguel St. Aubyn
    Abstract: This paper surveys the recent literature on law and order efficiency measurement. Law and order services include the services provided by the police, by the prison system and also by the judicial system (“the courts”). Key concepts prevalent in the efficiency measurement literature are presented. Decision making units most often found in the efficiency evaluation literature on law and order are charcterized. Inputs used by these units, and output measurement are examined and control and environment variables that explain or condition efficiency are dealt with. Methods of efficiency measurement are shortly presented. A synthesis of the main results and a short description of two important international databases on law and order are included.
    Keywords: efficiency measurement; law and economics; government expenditures.
    JEL: D24 K40 H59
    Date: 2008–03
  10. By: Carlos Pestana Barros; Jean-Pascal Guironnet; Nicolas Peypoch; William Roy
    Abstract: In this paper, we analyze the heterogeneity in the technical efficiency of a sample of French urban transport companies with a translog production frontier model. The model generates efficiency disentangling homogenous and heterogeneous variables. Our study concluded that outputs and inputs play a major role in transport efficiency and we find that the efficiency scores vary along the sample. Policy implication is derived.
    Keywords: Urban Transport; France, Translog random Frontier Model and Decision-Making Unit.
    Date: 2008–03
  11. By: Francesco VENTURINI (Universita' Politecnica delle Marche, Dipartimento di Economia)
    Abstract: To what extent are the productivity spillovers of information technology related;to R&D activity? Do these factors distinctly affect economic growth, or does the IT impact merely reflect the embodiment of R&D-driven technical progress? Based on country-level data, this work shows that both forms of technically advanced capital (R&D and IT) matter for long-run productivity growth. We control for either the domestic specialization in digital productions or import penetration of high-tech goods. In any case, the national endowment of IT assets emerges as a robust source of spillovers. It is also shown that the R&D base of the domestic producers of IT goods is a fundamental driver of productivity for the industrialized countries. In terms of TFP gains, a low degree of industry specialization in information technology can hardly be compensated by a country's trade openness, ie importing R&D-intensive (IT) goods from abroad. This contrasts to what occurs for less advanced productions.
    Keywords: Information Technology, Productivity, Research & Development, Spillovers, Trade
    JEL: E22 F43 O32 O47
    Date: 2008–05
  12. By: Revelli Federico (University of Turin)
    Abstract: Based on a unique measure of performance of English local governments in the provision of public services (Comprehensive Performance Assessment, CPA), this paper develops a simple analytical framework that fully encompasses the institutional features of the British system of local government finance in order to model the process of performance determination, and uses panel data (2002-2007) to identify the determinants of local government performance. Due to the nature of CPA ratings - measured on a five category (poor to excellent) scale - the empirical work relies on an ordered response approach allowing for cross-sectional heterogeneity. Maximum likelihood estimation of a random effects ordered probit model provides no evidence in support of the “spend more, get more” hypothesis, but rather suggests that spending in excess of centrally set standards has a detrimental effect on local public service performance.
    Date: 2008–04

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