New Economics Papers
on Efficiency and Productivity
Issue of 2009‒11‒07
eleven papers chosen by

  1. The Role of Technology, Investment and Ownership Structure in the Productivity Performance of the Manufacturing Sector in Vietnam By Carol Newman; Gaia Narciso; Finn Tarp; Vu Xuan Nguyet Hong
  2. Trade and Profitability: Is there an export premium? Evidence from Italian manufacturing firms By Marco Grazzi
  3. The Distributional Impact of Large Dams: Evidence from Cropland Productivity in Africa By Eric Strobl
  4. Unionisation Structures and Heterogeneous Firms By Sebastian Braun
  5. E-Business Implications for Productivity and Competitiveness By Pece Mitrevski; Olivera Kostoska; Marjan Angeleski
  6. Unobserved Heterogeneity and International Benchmarking in Public Transport By Astrid Cullman; Mehdi Farsi; Massimo Filippini
  7. Spillovers Through Backward Linkages from Multinationals: Measurement Matters! By Barrios, Salvador; Görg, Holger; Strobl, Eric
  8. Technological sources of productivity growth in Japan, the U.S. and Germany By Jesús Rodríguez López; José Luis Torres Chacón
  9. Foreign Ownership and Corporate Performance: The Czech Republic at EU Entry By Stepan Jurajda; Juraj Stancik
  10. SME Policy and Firms’ Productivity in Latin America By Ibarrarán, Pablo; Maffioli, Alessandro; Stucchi, Rodolfo
  11. Plant-Level Responses to Antidumping Duties: Evidence from U.S. Manufacturers By Justin Pierce

  1. By: Carol Newman (Department of Economics, Trinity College Dublin); Gaia Narciso (Department of Economics, Trinity College Dublin); Finn Tarp (Department of Economics, University of Copenhagen and UNU-Wider); Vu Xuan Nguyet Hong (Department for Economic Science Management Research, Central Institute for Economic Management, Vietnam)
    Abstract: This paper explores the productivity performance of the manufacturing sector in Vietnam between 2001 and 2007. Total Factor Productivity indices are computed using an index number approach and the productivity performance of manufacturing sub-sectors is analysed. We find that productivity increases in almost all sectors and that for many sectors the dispersion in productivity is declining over time. However, for the most productive sectors the gap is widening suggesting that productivity is being driven by the most productive enterprises getting better, leaving the least productive behind. The empirical analysis reveals investment and technology usage as important determinants of enterprise productivity levels. Specifically, higher levels of productivity are found in foreign- and state-owned enterprises, driven almost entirely by higher levels of investment and technology usage. Our results provide a strong quantitative basis in support of ongoing government initiatives aimed at encouraging investment in technology and innovation. They also point to the clear need for such initiatives to be complemented by measures to provide a more balanced distribution of investment, such that a level playing field is created for the different types of enterprises.
    Date: 2009–10
  2. By: Marco Grazzi
    Abstract: Using firm level data this study investigates the relation between export activity and firm's profitability. The paper shows that, contrary to other performance indicators such as productivity, exporting activity is not systematically associated to higher firm's profitability. This is shown both by means of non-parametric methods and, with an approach that is more standard within the empirical trade literature, by regression techniques that try to identify an "export premium".
    Keywords: export premium; productivity; profitability
    JEL: F10 D20 L60
    Date: 2009–10–27
  3. By: Eric Strobl (Ecole Polytechnique, Département d'Économie, France.)
    Abstract: We examine the distributional impact of large dams on cropland productivity in Africa. As our unit of analysis we use a scientifically based spatial breakdown of the continent that allows one to exactly define regions in terms of their upstream/downstream relationship at a highly disaggregated level. We then use satellite data to derive measures of cropland productivity within these areas. Our econometric analysis shows that while regions downstream benefit from large dams, cropland within the vicinity tends to suffer productivity losses during droughts. Overall our results suggest that because of rainfall shortages dams caused a net loss of 0.96 percent in production in Africa over our sample period (1981-2000). However, further dam construction in appropriate areas could potentially lead to large increases in cropland production even if rainfall is not plenty.
    Keywords: dams, agricultural productivity, Africa
    JEL: O20 Q19
    Date: 2009–10
  4. By: Sebastian Braun
    Abstract: The effects of unions on productivity and firm performance have been the topic of extensive research. Existing studies have, however, primarily focused on firm-level bargaining and on markets that are characterised by a small and fixed number of identical firms. This paper studies how different unionisation structures affect firm productivity and firm performance in a monopolistic competition model with heterogeneous firms and free entry. While centralised bargaining induces tougher selection among heterogeneous producers and thus increases average productivity, firm-level bargaining allows less productive entrants to remain in the market. Centralised bargaining also results in higher average output and profit levels than either decentralised bargaining or a competitive labour market. From the perspective of consumers, the choice between centralised and decentralised bargaining involves a potential trade-off between product variety and product prices
    Keywords: Trade unions, heterogeneous firms, productivity, firm performance
    JEL: J24 J50 D43
    Date: 2009–10
  5. By: Pece Mitrevski (Faculty of Technical Sciences, Bitola, Macedonia); Olivera Kostoska; Marjan Angeleski (Faculty of Economics, Prilep, Macedonia)
    Abstract: Information and Communication Technology (ICT) affects to a great extent the output and productivity growth. Evidence suggests that investment growth in ICT has rapidly accelerated the TFP (total factor productivity) growth within the European Union. Such progress is particularly essential for the sectors which themselves produce new technology, but it is dispersing to other sectors, as well. Nevertheless, decrease in ICT investment does not necessarily decline the ICT contribution to output and productivity growth. These variations come out from the problems related to the particular phenomenon proper assessment, but predominantly from the companies’ special requirements, as well as the necessary adjustments of labour employed. Hence, this paper aims at estimating the huge distinction in terms of ICT and TFB contributions to labour productivity growth among some of the European member states, as well as the factors which might stand behind the particular findings.
    Keywords: e-business, ICT, productivity, competitiveness
    JEL: C1 D8 R11
    Date: 2009–05
  6. By: Astrid Cullman (German Institute for Economic Research DIW Berlin, Department of Innovation, Manufacturing, Service, Berlin, Germany); Mehdi Farsi (Center for Energy Policy and Economics CEPE, Department of Management, Technology and Economics, ETH Zurich, Switzerland); Massimo Filippini (Center for Energy Policy and Economics CEPE, Department of Management, Technology and Economics, ETH Zurich, Switzerland)
    Abstract: We analyze the technical efficiency of German and Swiss urban public transport companies by means of SFA. In transport networks we might face different network structures or complexities, not observed, but influencing the production process. The unobserved factors are typically modeled as separable factors. However, we argue that the entire production process is organized around different network structures. Therefore, they are inevitably non-separable from the observed inputs and outputs. The adopted econometric model is a random coefficient stochastic frontier model. We estimate an input distance function for the years 1991 to 2006. The results underline the presence of unobserved non-separable factors.
    Date: 2009–08
  7. By: Barrios, Salvador (European Commission); Görg, Holger (Kiel Institute for the World Economy); Strobl, Eric (Ecole Polytechnique, Paris)
    Abstract: We argue that the measures of backward linkages used in recent papers on spillovers from multinational companies are potentially problematic, as they depend on a number of restrictive assumptions, namely that (i) multinationals use domestically produced inputs in the same proportion as imported inputs, (ii) multinationals have the same input sourcing behaviour as domestic firms, irrespective of their country of origin, and (iii) the demand for locally produced inputs by multinationals is proportional to their share of locally produced output. We discuss why these assumptions are likely to be violated in practice, and provide alternative measures that overcome these drawbacks. Our results, using plant level data for Ireland, show clearly that the choice of backward linkage measure and thus, the assumptions behind them, matters greatly in order to draw possible conclusions regarding the existence of FDI-related spillovers. Using the standard measure employed in the literature we fail to find robust evidence for spillovers through backward linkages. However, when we use alternative measures of backward linkages that relax assumptions (i)-(iii), we find robust evidence for positive FDI backward spillover effects.
    Keywords: multinationals, backward spillovers, productivity spillovers
    JEL: F23 L22
    Date: 2009–10
  8. By: Jesús Rodríguez López (Department of Economics, Universidad Pablo de Olavide); José Luis Torres Chacón (Departamento de Teoría e Historia Económica de la Universidad de Málaga)
    Abstract: We use a dynamic general equilibrium growth model to quantify the contribution to productivity growth from different technological sources in the three leading economies of the world: Japan, Germany and the U.S. The sources of technology are classified into neutral progress and investment-specific progress. The latter can be split into two different types of equipment: Information and Communication Technologies (ICT) and non-ICT equipment. This decomposition analysis is done for both long term and short term growth. In the long run, neutral technological change is the main source of productivity growth in Japan and Germany. For the U.S., the main source of productivity growth arises from investment-specific technological change, mainly associated with ICT. Finally, impulse-response analysis reveals that deviations from the balanced growth path in the short run are mainly due to neutral shocks in the three countries.
    Keywords: Productivity growth; Investment-specific progress; Neutral progress; Information and communication technology.
    JEL: O3 O4
    Date: 2009–10
  9. By: Stepan Jurajda; Juraj Stancik
    Abstract: Does foreign ownership improve corporate performance or do foreign firms merely select more productive targets for takeover? Do workers benefit from foreign acquisitions? We answer these questions based on comparing the be- fore/after change in several performance indicators of Czech firms subject to foreign takeover after 1997, i.e., after the initial waves of privatization were completed, with the corresponding performance change of matched compa- nies that remain domestically owned until 2005. We find that the impact of foreign investors on domestic acquisitions is significantly positive only in non-exporting manufacturing industries, while it is small in both services and manufacturing industries competing on international markets.
    Keywords: Productivity, foreign ownership, FDI
    JEL: C23 D24 F2
    Date: 2009–09
  10. By: Ibarrarán, Pablo (Inter-American Development Bank); Maffioli, Alessandro (Inter-American Development Bank); Stucchi, Rodolfo (Inter-American Development Bank)
    Abstract: Very little is known about the effectiveness of SME policies, and a careful look at the structure, mechanisms and incentives provided by these policies suggest caution in their implementation and, most importantly, the need to carefully and closely monitor their results. This paper relies on the microeconometric analysis of a homogeneous dataset of sixteen Latin American and Caribbean countries to analyze the magnitude and determinants of the productivity gap between large and SME firms and to simulate of the impact on productivity of various policy scenarios.
    Keywords: SMEs, SME policy, productivity, Latin America
    JEL: D24 L53 L60 O38 O54
    Date: 2009–10
  11. By: Justin Pierce
    Abstract: This paper describes the effects of a temporary increase in tariffs on the performance and behavior of U.S. manufacturers. Using antidumping duties as an example of temporary protection, I compare the responses of protected manufacturers to those predicted by models of trade with heterogeneous firms. I find that apparent increases in revenue productivity associated with antidumping duties are primarily due to increases in prices and mark-ups, as physical productivity falls among protected plants. Moreover, antidumping duties slow the reallocation of resources from less productive to more productive uses by reducing product-switching behavior among protected plants.
    Keywords: Antidumping; Temporary Protection; Heterogeneous Firms; Productivity
    JEL: F13 F14 D24
    Date: 2009–10

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.