nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2009‒11‒21
nine papers chosen by
Angelo Zago
University of Verona

  1. Measuring bank efficiency: tradition or sophistication? - A note By Daley, Jenifer; Matthews, Kent
  2. Product Policy and the East-West Productivity Gap: Evidence from German Manufacturing Firms By Bernd Görzig; Martin Gornig; Ramona Voshage; Axel Werwatz
  3. Sources of Agricultural Productivity Growth in Central Asia: The Case of Tajikistan and Uzbekistan By Lerman, Zvi; Sedik, David
  4. Access to Credit, Factor Allocation and Farm Productivity: Evidence From the CEE Transition Economies By Jan Fałkowski; Pavel Ciaian; d'Artis Kancs
  5. Trade-Revealed TFP By Andrea Finicelli; Patrizio Pagano; Massimo Sbracia
  6. Do Firms Learn by Exporting or Learn to Export? Evidence from Small and Medium-Sized Enterprises (SMEs) in Swedish Manufacturing By Hansson, Pär; Eliasson, Kent; Lindvert, Markus
  7. Growing at the Production Frontier. European Aggregate Growth, 1870-1914 By Albert Carreras; Camilla Josephson
  8. The Effect of Immigration on Productivity: Evidence from US States By Giovanni Peri
  9. What explains the evolution of productivity and competitiveness? The innovation link By Jaumandreu, Jordi

  1. By: Daley, Jenifer; Matthews, Kent (Cardiff Business School)
    Abstract: The recent literature on measuring bank performance indicates a preference for sophisticated techniques over simple accounting ratios. We explore the results and relationships between bank efficiency estimates using accounting ratios and Data Envelope Analysis (DEA) with bootstrap among Jamaican banks between 1998 and 2007. The results indicate different outcomes for the traditional accounting ratios and the sophisticated DEA methodology in the measurement of bank efficiency. GLS random effects two-variable regression tests for superiority using a risk index for insolvency suggest an advantage in favour of the DEA.
    Keywords: Bank efficiency; Jamaica; Accounting Ratios
    JEL: G21 G28 G29
    Date: 2009–11
    URL: http://d.repec.org/n?u=RePEc:cdf:wpaper:2009/24&r=eff
  2. By: Bernd Görzig; Martin Gornig; Ramona Voshage; Axel Werwatz
    Abstract: After 20 years of transition from an economy integrated in an exchange scheme of planned economies towards an open market economy based on the ideas of competition, we ask whether East German firms succeeded in finding their place in the international division of labour. We concentrate on the question, to what extent they have caught up with the productivity level of their Western counterparts of similar size and sector and how this productivity difference is related to changes in their product policy. We analyse these questions with a unique data set provided by Statistics Germany that contains both product policy and productivity information for individual manufacturers from both parts of the country. Using a decomposition approach suggested by Nopo (2008) as a nonparametric extension of the widely-used Oaxaca-Blinder methodology (Blinder 1973; Oaxaca 1973) we find that the time span from 1995 - 2004 has two component periods: a period of adaptation from 1995 to 2001and a period of branding from 2002 to 2004. The initial period is characterized by a smaller share of Eastern firms that modify their product range and by a large productivity gap of Eastern Non-Modifiers if compared to Western Non-Modifiers of comparable size and sector. The evidence for the second period, however, points to a more active and established role of East German manufacturers: more of them alter their product range and step up their productivity performance.
    Keywords: Productivity, product policy, decomposition, transition economies
    JEL: L25 D24 P23 C14
    Date: 2009
    URL: http://d.repec.org/n?u=RePEc:diw:diwwpp:dp945&r=eff
  3. By: Lerman, Zvi; Sedik, David
    Abstract: The paper examines agricultural production and productivity growth in two Central Asian countries â Tajikistan and Uzbekistan. Both countries are characterized by a significant shift of resources from the traditional Soviet model of collective agriculture to more market-compliant individual and family farming. In both countries, the beginning of the policy-driven switch to family farming around 1997 coincided with the beginning of recovery in agriculture, namely resumption of agricultural growth after a phase of transition decline since 1991. In addition to growth in total agricultural production, we also observe significant increases in productivity of both land and labor since 1997. These observations suggest that productivity growth may be attributable to the changes in farming structure in Central Asia. To check this conjecture we assess the sources of growth by applying the standard Solow growth accounting methodology. Using time series of country statistics for farms of different organizational forms, we decompose the growth in output into growth in the resource base (extensive growth) and growth in productivity (intensive growth). Solow growth accounting clearly shows that, first, much of the growth at the country level is attributable to increases in productivity rather than increases in resources and, second, the increases in productivity in family farms (especially household plots) outstrip the increases in productivity in former collective and state farms. These findings confirm that the recovery of agricultural production in Central Asia has been driven largely by productivity increases, and it is the individual farms that are the main source of agricultural productivity increases.
    Keywords: agricultural productivity, agricultural growth, family farms, corporate farms, comparative performance, agrarian reforms, transition countries, Central Asia, Tajikistan, Uzbekistan, Agricultural and Food Policy, Community/Rural/Urban Development, Food Security and Poverty, International Development, Land Economics/Use, Productivity Analysis, P27, P31, P32, Q15, R14,
    Date: 2009–09
    URL: http://d.repec.org/n?u=RePEc:ags:huaedp:54713&r=eff
  4. By: Jan Fałkowski (Faculty of Economic Sciences, University of Warsaw); Pavel Ciaian (European Commission - Joint Research Centre (IPTS); Catholic University of Leuven (LICOS); Economics and Econometrics Research Institute (EERI)); d'Artis Kancs (European Commission - Joint Research Centre (IPTS); Catholic University of Leuven (LICOS); Economics and Econometrics Research Institute (EERI))
    Abstract: This paper analyses how farm access to credit affects farm input allocation and farm efficiency in the CEE transition countries. Drawing on a unique farm level panel data with 37,409 observations and employing a matching estimator we are able to control for the key source of endogeneity – unoberserved heterogeneity. We find that farms are credit constrained both in the short-run as well as in the long-run, but that credit constraint is asymmetric between inputs. Our estimates suggest that farm access to credit increases TFP up to 1.9% per 1000 EUR of additional credit. The use of variable inputs and capital investment increases up to 2.3% and 29%, respectively, per 1000 EUR of additional credit. Due to credit-financed investment in labour-saving farm equipment, labour use reduces for low level of credit. Farms are found not to be credit constrained with respect to land.
    Keywords: access to credit, investment, factor allocation, productivity, transition countries
    JEL: Q12 P14
    Date: 2009
    URL: http://d.repec.org/n?u=RePEc:war:wpaper:2009-12&r=eff
  5. By: Andrea Finicelli (Bank of Italy); Patrizio Pagano (Bank of Italy); Massimo Sbracia (Bank of Italy)
    Abstract: We introduce a novel methodology to measure the relative TFP of the tradeable sector across countries, based on the relationship between trade and TFP in the model of Eaton and Kortum (2002). The logic of our approach is to measure TFP not from its "primitive" (the production function) but from its observed implications. In particular, we estimate TFPs as the productivities that best fit data on trade, production, and wages. Applying this methodology to a sample of 19 OECD countries, we estimate the TFP of each country's manufacturing sector from 1985 to 2002. Our measures are easy to compute and, with respect to the standard development-accounting approach, are no longer mere residuals. Nor do they yield common "anomalies", such as the higher TFP of Italy relative to the US.
    Keywords: Multi-factor productivity, TFP measurement, Eaton-Kortum model
    JEL: F10 D24 O40
    Date: 2009–10
    URL: http://d.repec.org/n?u=RePEc:bdi:wptemi:td_729_09&r=eff
  6. By: Hansson, Pär (Department of Business, Economics, Statistics and Informatics); Eliasson, Kent (Department of Economics, Umeå University); Lindvert, Markus (Growth Analysis)
    Abstract: Using a matching approach, we compare the productivity trajectories of future exporters and matched and unmatched non-exporters. Future exporters have higher productivity than do unmatched non-exporters before entry into the export market, which indicates self-selection into exports. More interestingly, we also find a productivity increase among future exporters relative to matched non-exporters 1-2 years before export entry. However, the productivity gap between future exporters and matched non-exporters does not continue to grow after export entry. Our results suggest that learning-to-export occurs but that learning-by-exporting does not. In contrast to previous studies on Swedish manufacturing, we focus particularly on small and medium-sized enterprises (SMEs)
    Keywords: productivity; learning-to-export; learning-by-exporting; matching
    JEL: D24 F14
    Date: 2009–11–16
    URL: http://d.repec.org/n?u=RePEc:hhs:oruesi:2009_015&r=eff
  7. By: Albert Carreras; Camilla Josephson
    Abstract: The view of a 1870-1913 expanding European economy providing increasing welfare to everybody has been challenged by many, then and now. We focus on the amazing growth that was experienced, its diffusion and its sources, in the context of the permanent competition among European nation states. During 1870-193 the globalized European economy reached a “silver age”. GDP growth was quite rapid (2.15% per annum) and diffused all over Europe. Even discounting the high rates of population growth (1.06%), per capita growth was left at a respectable 1.08%. Income per capita was rising in every country, and the rates of improvement were quite similar. This was a major achievement after two generations of highly localized growth, both geographically and socially. Growth was based on the increased use of labour and capital, but a good part of growth (73 per cent for the weighted average of the best documented European countries) came out of total factor productivity –efficiency gains resulting from not well specified ultimate sources of growth. This proportion suggests that the European economy was growing at full capacity –at its production frontier. It would have been very difficult to improve its performance. Within Europe, convergence was limited, and it only was in motion after 1900. What happened was more the end of the era of big divergence rather than an era of convergence.
    Keywords: Economic history, aggregate growth, total factor productivity, comparative national patterns, Europe
    JEL: E01 N10 N13 O47 O52
    Date: 2009–10
    URL: http://d.repec.org/n?u=RePEc:upf:upfgen:1179&r=eff
  8. By: Giovanni Peri
    Abstract: Using the large variation in the inflow of immigrants across US states we analyze the impact of immigration on state employment, average hours worked, physical capital accumulation and, most importantly, total factor productivity and its skill bias. We use the location of a state relative to the Mexican border and to the main ports of entry, as well as the existence of communities of immigrants before 1960, as instruments. We find no evidence that immigrants crowded-out employment and hours worked by natives. At the same time we find robust evidence that they increased total factor productivity, on the one hand, while they decreased capital intensity and the skill-bias of production technologies, on the other. These results are robust to controlling for several other determinants of productivity that may vary with geography such as R&D spending, computer adoption, international competition in the form of exports and sector composition. Our results suggest that immigrants promoted efficient task specialization, thus increasing TFP and, at the same time, promoted the adoption of unskilled-biased technology as the theory of directed technologial change would predict. Combining these effects, an increase in employment in a US state of 1% due to immigrants produced an increase in income per worker of 0.5% in that state.
    JEL: F22 J61 R11
    Date: 2009–11
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:15507&r=eff
  9. By: Jaumandreu, Jordi (IESE Business School)
    Abstract: This paper addresses the recent evolution of productivity and competitiveness in Catalonia and their links with the innovation activity of firms. Firstly, it summarizes the evolution of productivity, competitiveness, firms' strategies and the state of innovation. A slowdown in productivity growth and increasing revealed difficulties in some world markets are real, and the weakness of innovation may be a reason. The paper then quantifies some of the links between innovation, productivity and competitiveness. Innovation has a positive impact on productivity and competitiveness. First of all, innovation expenditures induce cost advantages and these cost advantages are a significant explanation for firms' exports. Furthermore, product innovation helps exports, too. Moreover, R&D activities in Catalonia benefit from high spillovers, and productivity impact is even higher when firms develop R&D activities outside as well. Despite all this, the current level of innovation expenditure is comparatively low and shows signs of lack of dynamism. Firms need to switch from the current equilibrium to the requirements of the coming years.
    Keywords: Labor productivity; Competitiveness; innovation; cost;
    Date: 2009–07–17
    URL: http://d.repec.org/n?u=RePEc:ebg:iesewp:d-0804&r=eff

This nep-eff issue is ©2009 by Angelo Zago. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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