New Economics Papers
on Efficiency and Productivity
Issue of 2010‒03‒20
fourteen papers chosen by

  1. Innovation, Adoption, Ownership, and Productivity: Evidence from Ukraine By J. David Brown; John S. Earle; Hanna Vakhitova; Vitaliy Zheka
  2. Ageing Workforce, Productivity and Labour costs of Belgian Firms By Vincent VANDENBERGHE; Fabio WALTENBERG
  3. Technical Change and Total Factor Productivity Growth: The Case of Chinese Provinces By Heshmati, Almas; Kumbhakar, Subal C.
  4. Outsourcing versus Integration at Home or Abroad By Stefano Federico
  5. Efficiency of public and publicly-subsidised high schools in Spain. Evidence from PISA 2006 By Mancebón-Torrubia, María-Jesús; Calero, Jorge; Choi, Álvaro; Ximénez-de-Embún, Domingo P.
  6. Exports and productivity selection effects for Dutch firms By Henk Kox; Hugo Rojas-Romagosa
  7. Ukrainian Firm-Level Export Dynamics: Structural Analysis By Yevgeniya Shevtsova
  8. What is the Long Run Growth Rate of the East Asian Tigers? By B. Bhaskara Rao; Artur Tamazian; Rup Singh
  9. International Trade and Productivity: Firm-Level Evidence from Ukraine By Yevgeniya Shevtsova
  10. Financial Constraints and Innovation: Why Poor Countries Don't Catch Up By Gorodnichenko, Yuriy; Schnitzer, Monika
  11. Socio-Economic Impact of Mobile Phones on Indian Agriculture By Surabhi Mittal; Gaurav Tripathi; Sanjay Gandhi
  12. Corporate Lobbying and Financial Performance By Chen, Hui; Parsley, David; Yang, Ya-wen

  1. By: J. David Brown; John S. Earle; Hanna Vakhitova; Vitaliy Zheka
    Abstract: How do new and foreign firms achieve superior productivity? Do they conduct more and better R&D? Or do they distinguish themselves through computerization and organizational capital? We investigate the determinants of and returns to several types of investment, using a panel of over 40,000 Ukrainian industrial firms in 2000-2007. Foreign firms engage in more non-technological investment and IT and less in R&D than domestic private firms. Similarly, new firms invest more in non-technological capital and IT and less in R&D than initially state-owned firms. Productivity gains from R&D and non-technology investment are insignificantly different across ownership types, whereas foreign firms achieve much higher returns to IT investment than other firms. These results suggest that foreign firms outperform others via organizational capital that is better able to exploit IT investment. New firm productivity growth is a result of higher investment volume rather than investment efficiency.
    Keywords: R&D, information technology, foreign ownership, transition, Eastern Europe,<br /> Ukraine
    JEL: D21 D24 F23 G34 L33 O32 P31
    Date: 2010
  2. By: Vincent VANDENBERGHE (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES)); Fabio WALTENBERG (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and Centro de Estudos sobre Desigualdade e Desenvolvimento (CEDE), Universidade Federal Fluminense (UFF), Brazil)
    Abstract: The Belgian population is ageing due to demographic changes, so does the workforce of firms active in the country. Such a trend is likely to remain for the foreseeable future. And it will be reinforced by the willingness of public authorities to expand employment among individuals aged 50 or more. But are employers willing to employ older workers? The answer depends to a large extent on the ratio between older workersÕ productivity and their cost to employers. To address this question we tap into a unique firm-level panel data set to produce robust evidence on the causal effect of ageing on productivity and labour costs. Unobserved firm fixed-effects and short-term endogeneity of workforce age pose serious estimation challenges, which we try to cope with. Our results indicate a negative productivity differential for older workers ranging from 20 to 40% when compared with prime-age workers, and these productivity differentials are not compensated by lower relative labour costs. Furthermore, the (now dominant) service sector does not seem to offer working conditions that mitigate the negative age/productivity relationship. Finally, older workers in smaller firms (<100 workers) display a larger productivity differential and a productivity that is less aligned on labour costs.
    Keywords: Ageing, Labour Productivity, Panel Data Analysis
    JEL: J24 C52 D24
    Date: 2010–02–12
  3. By: Heshmati, Almas (Seoul National University); Kumbhakar, Subal C. (Binghamton University, New York)
    Abstract: In the literature technical change is mostly assumed to be exogenous and specified as a function of time. However, some exogenous external factors other than time can also affect technical change. In this paper we model technical change via time trend (purely external non-economic) as well as other exogenous (external economic) factors (technology shifters). We define technology index based on the external economic factors which are indicators of ‘technology’. Thus our definition of production function is amended to accommodate several technology shifters which are not separable from the traditional inputs. That is, these technology shifters allow for non-neutral shift in the production function. In doing so we are able to decompose technical change (a component of TFP change) into two parts. One part is driven by time (manna from heaven) and the other part is related to producer specific external economic factors. These exogenous technology shifters are aggregated (via hedonic aggregator functions) into several groups (technology indices) for parsimonious parametric specification. The empirical model uses panel data on Chinese provinces. We identify a number of key technology shifters and their effect on technical change and TFP growth of provinces.
    Keywords: technical change, total factor productivity growth, technology indicator, technology shifter, Chinese provinces
    JEL: C33 C43 D24 O18 O47
    Date: 2010–02
  4. By: Stefano Federico (Bank of Italy, Economics and International Relations)
    Abstract: Using data on a sample of Italian manufacturing companies, this paper analyzes the location (at home or abroad) and the mode of organization (outsourcing versus integration) of intermediate inputs production. We find evidence of a productivity ordering (largely consistent with the assumptions in Antràs and Helpman 2004) where foreign integration is chosen by the most productive and domestic outsourcing by the least productive firms; those with medium-high productivity choose domestic integration, those with medium-low productivity foreign outsourcing. We also find that the preference for integration over outsourcing is positively related to some indicators of headquarter intensity, notably capital intensity, as predicted by Antràs (2003) and Antràs and Helpman (2004).
    Keywords: international outsourcing, foreign direct investment, intra-firm trade, productivity
    JEL: F12 F23 L22
    Date: 2010–02
  5. By: Mancebón-Torrubia, María-Jesús; Calero, Jorge; Choi, Álvaro; Ximénez-de-Embún, Domingo P.
    Abstract: The purpose of this paper is to compare the efficiency of the Spanish public and publicly-subsidised private high schools using Data Envelopment Analysis (DEA) fed by the results provided by a hierarchical linear model (HLM) applied to PISA-2006 (Programme for International Students Assessment) microdata. This study places special emphasis on the estimation of the determinants of school outcomes, the educational production function being estimated through an HLM that takes into account the nested nature of PISA data. Inefficiencies are then measured through the DEA and decomposed into managerial (related to individual performance) and programme (related to structural differences between management models), following Silva Portela and Thanassoulis (2001) approach. Once differences in pupils’ background and individual management inefficiencies have been eliminated, results reveal that Spanish public high schools are more efficient than publicly-subsidised private ones.
    Keywords: Efficiency; data envelopment analysis; secondary education; educational outcome; PISA
    JEL: I21 I28 I22
    Date: 2010
  6. By: Henk Kox; Hugo Rojas-Romagosa
    Abstract: This study presents recently available data on the microstructure of Dutch exports and the relation between export participation and productivity at the .rm and establishment-level. We test whether recent theories of international trade with heterogeneous .rms can explain the patterns in the Dutch data. We .nd signi.cant evidence that .rms self-select into export participation, even after controlling for sector and .rm-speci.c characteristics. In general, only the most productive Dutch .rms participate in exports and foreign direct investment. In addition, we .nd evidence for the learning-by-exporting hypothesis once we control for the .rm.s distance to the international productivity frontier.
    Keywords: Exports; foreign direct investment; productivity; self selection by firms
    JEL: D21 D24 F12 F23 L1
    Date: 2010–03
  7. By: Yevgeniya Shevtsova
    Abstract: In the following chapter the focus will remain on exploring the linkages between plants' exporting activity and productivity performance. However, now I will try to widen the scope of the study to explore export dynamics at the intensive and extensive margin. Indeed the existence of plant-level productivity gains from international market exposure is the corner-stone of the trade policy. Productivity gains from engagement in international trade usually serve as a main justification of the trade liberalization policies. Pre-entry productivity gains are mainly associated with a higher level of competition in international markets, which requires potential entrants to improve their efficiency before the entry. Post-entry gains usually come in the form of increased returns to innovation, economies of scale, better managerial practices, reduced X-inefficiency, etc.
    Date: 2010
  8. By: B. Bhaskara Rao; Artur Tamazian; Rup Singh
    Abstract: New panel data estimates for the four East Asian Tigers show that the contribution of total factor productivity (TFP) to growth is much higher than past estimates. An extended production function with learning by doing implies that TFP is about 3.5% and these countries will grow at this rate in the long run.
    Keywords: Asian Tigers, Systems Dynamic GMM, Growth Accounting, Factor Accumulation as Residual.
    JEL: O1 N1
    Date: 2010–01–04
  9. By: Yevgeniya Shevtsova
    Abstract: In the last quarter-century there has been a considerable increase in the openness of the Ukrainian economy. The percentage of Ukrainian exporting firms has risen sharply after the collapse of the Soviet Union in 1991 and has been exhibiting strong positive dynamics since then. At the same time the structure of Ukrainian export has undergone through some significant changes. Row materials and semi-processed products that constituted the largest part of the Ukrainian export during 1990s have been partially replaced by the manufactured products of higher levels of processing. In the current paper the research focus is made on exploring export-productivity linkages at the level of individual firms on the basis of the database covering main output sectors of the Ukrainian economy for the period 2000-2005. During the past decade increasing number of studies has emerged on the link between exporting activity and productivity at the micro-level. The literature suggested a number of ways by which engaging into international trade could be beneficial to the firm's as well as aggregate productivity growth.
    Date: 2010
  10. By: Gorodnichenko, Yuriy (University of California, Berkeley); Schnitzer, Monika (University of Munich)
    Abstract: This paper examines micro-level channels of how financial development can affect macroeconomic outcomes like the level of income and export intensity. We investigate theoretically and empirically how financial constraints affect a firm's innovation and export activities, using unique firm survey data which provides direct measures for innovations and firm-specific financial constraints. We find that financial constraints restrain the ability of domestically owned firms to innovate and export and hence to catch up to the technological frontiers. This negative effect is amplified as financial constraints force export and innovation activities to become substitutes although they are generally natural complements.
    Keywords: innovation, productivity, financial constraint, export, technology frontier, BEEPS
    JEL: O3 O16 F1 G3
    Date: 2010–02
  11. By: Surabhi Mittal; Gaurav Tripathi; Sanjay Gandhi
    Abstract: This paper investigates a series of questions that explore this topic: What kind of information do farmers value the most to improve agricultural productivity? Do mobile phones and mobile-enabled agricultural services have an impact on agriculture? What are the factors that impede the realisation of the full productivity enhancing potential of mobile phones? The answers to these questions have important implications for mobile operators, for information service providers, and for policymakers. The quality of information, its timeliness and trustworthiness are the three important features that have to be ensured to enable farmers to use it effectively to improve productivity. [ICRIER WP No. 246].
    Keywords: information, Indian,socio-economic, fishermen, agricultural productivity, farmers, services, mobile operators, information,
    Date: 2010
  12. By: Chen, Hui; Parsley, David; Yang, Ya-wen
    Abstract: Corporate lobbying activities are designed to influence legislators and thus to further company goals by encouraging favorable policies and/or outcomes. Using data made available by the Lobbying Disclosure Act of 1995, this study examines corporate lobbying activities from a financial perspective. We find that on average, lobbying is positively related to accounting and market measures of financial performance. These results are robust across a number of empirical specifications and continue to hold when we account for potential sample selection. We also report market performance evidence using a portfolio approach. We find that portfolios of firms with the highest lobbying intensities significantly outperform their benchmarks in the three years following portfolio formation.
    Keywords: Corporate Lobbying; accounting performance; market returns; portfolio
    JEL: G30 G10
    Date: 2010–01
  13. By: Zekic, Stanislav; Gajic, Milivoj; Lovre, Koviljko
    Abstract: The process of transition and, within it, the agricultural transformation in the Western Balkan countries resulted, in the first phase, in the weakening of the developmental performances in agriculture. Such tendencies widened the gap between the countries of the Western Balkans and the EU countries, which continued their steady increase in agricultural productivity. Unfavorable tendencies in agricultural productivity adversely affected its competitiveness, and, consequently, the competitiveness of the rural economy as a whole. The effect of the low agricultural competitiveness on the competitiveness of the rural economy is determined by the importance of agriculture in the rural economy, which is substantial in the West Balkan countries.
    Keywords: Productivity, Agriculture, Competitiveness, Rural Development, the West Balkans, Transition, Agribusiness, Community/Rural/Urban Development, International Development, Productivity Analysis,
    Date: 2009–12
  14. By: Popovic, Rade; Knezevic, Marija; Tosin, Milos
    Abstract: In the paper is analyzed competitiveness of Serbian family dairy farms in lowland region in 2007, with some aspects of possible perspectives. Globalization process, expected EU integrations and set of free trade agreements will expose Serbian farms in close future to higher level of competition. Identified structural changes, refers on dairy farms concentration and specialization in lowland region in recent years. Estimated model of cost function revealed that family farms with bigger herd size have lower average costs of milk production. Economic efficiency, measured in terms of cost efficiency, shows that larger dairy farms are more efficient. But, not all smaller farms are inefficient. Due to good management some smaller farms are competitive on national market. Milk price volatility in period 2007 to 2009 hurts all farms, but the most farms with higher average costs, which are usually inefficient dairy farms.
    Keywords: Competitiveness, Dairy enterprise, Dairy farm, Milk production, Serbia, Agribusiness, Livestock Production/Industries,
    Date: 2009–12

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