nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2010‒04‒11
twelve papers chosen by
Angelo Zago
University of Verona

  1. A Detailed Analysis of the Productivity Performance of Mining in Canada By Andrew Sharpe; Celeste Bradley
  2. Public and private inputs in aggregate production and growth - a cross-country efficiency approach By António Afonso; Miguel St. Aubyn
  3. A Detailed Analysis of the Productivity Performance of Oil and Gas Extraction in Canada By Andrew Sharpe; Celeste Bradley
  4. Unbundling Canada's Weak Productivity Performance By Andrew Sharpe
  5. Energy use and energy efficiency development in the German and Colombian textile industries By Clara Inés Pardo Martínez
  6. The Paradox of Market-Oriented Public Policy and Poor Productivity Grwoth in Canada By Andrew Sharpe
  7. Productivity Growth and Levels in France, Japan, the United Kingdom and the United States in the Twentieth Century. By Cette, G.; Kocoglu, Y.; Mairesse, J.
  8. Institutional Complexity and Managerial Efficiency: A Theoretical Model and an Empirical Application By D.Forrest; M.Jara; D.Paolini; J.D.Tena
  9. Competition and productivity: a review of evidence By Thomas J. Holmes; James A. Schmitz, Jr.
  10. Productivity, Quality and Exporting Behavior Under Minimum Quality Requirements By Juan Carlos Hallak
  11. Decentralization and Local Governments’ Performance: How Does Fiscal Autonomy Affect Spending Efficiency? By Lorenzo Boetti; Massimiliano Piacenza; Gilberto Turati
  12. Employment and productivity: disentangling employment structure and qualification effects By Renaud Bourlès; Gilbert Cette; Anastasia Cozarenco

  1. By: Andrew Sharpe; Celeste Bradley
    Abstract: In recent years, the productivity performance of mining in Canada has been very poor. Based on official real GDP and labour input estimates from Statistics Canada, labour productivity in mining fell by 2.21 per cent per year between the 2000 cyclical peak and 2007, with capital productivity down 0.28 per cent per year and total factor productivity (TFP) off 1.07 per cent per year between 2000 and 2006. Among the various hypotheses put forward to explain these trends, the most robust seems to be that higher output prices have suppressed productivity growth through two effects: increased exploitation of low-productivity marginal resource deposits, and business decisions based on profitability rather than productivity. Despite the decline in productivity in mining, it is not necessarily true that Canadians are worse off. In fact, increased relative output prices for mining products as well as a high productivity level in the mining sub-sector, have resulted in positive contributions to Canada‟s aggregate labour productivity growth from 2000 to 2006 and an offsetting effect on the post-2000 aggregate labour productivity slowdown.
    Keywords: productivity, mining, labour productivity, output per hour, capital intensity, total factor productivity, Canada, resource extraction
    JEL: O13 O30 O51 J00 E23 Q30 D24 J08
    Date: 2009–09
    URL: http://d.repec.org/n?u=RePEc:sls:resrep:0907&r=eff
  2. By: António Afonso (European Central Bank, Directorate General Economics, Kaiserstraße 29, D-60311 Frankfurt am Main, Germany; ISEG/TULisbon – Technical University of Lisbon, Department of Economics; UECE – Research Unit on Complexity and Economics, R. Miguel Lupi 20, 1249-078 Lisbon, Portugal.); Miguel St. Aubyn (ISEG/TULisbon – Technical University of Lisbon, Department of Economics; UECE – Research Unit on Complexity and Economics, R. Miguel Lupi 20, 1249-078 Lisbon, Portugal.)
    Abstract: In a cross section of OECD countries we replace the macroeconomic production function by a production possibility frontier, TFP being the composite effect of efficiency scores and possibility frontier changes. We consider, for the periods 1970, 1980, 1990, 2000, one output: GDP per worker; three inputs: human capital, public physical capital per worker and private physical capital per worker. We use a semiparametric analysis, computing Malmquist productivity indexes, and we also resort to stochastic frontier analysis. Results show that private capital is important for growth, although public and human capital also contribute positively. A governance indicator, a non-discretionary input, explains inefficiency. Better governance helps countries to achieve a better performance. Non-parametric and parametric results coincide rather closely on the countries movements vis-à-vis the possibility frontier, and on their relative distances to the frontier. JEL Classification: C14, D24, H50, O47.
    Keywords: economic growth, public spending, efficiency, Malmquist index.
    Date: 2010–02
    URL: http://d.repec.org/n?u=RePEc:ecb:ecbwps:20101154&r=eff
  3. By: Andrew Sharpe; Celeste Bradley
    Abstract: In recent years, the productivity performance of oil and gas extraction in Canada has been dismal. Based on official real GDP and labour input estimates from Statistics Canada, labour productivity in oil and gas extraction fell 8.23 per cent per year between the 2000 cyclical peak and 2007, with capital productivity down 5.97 per cent per year over the same period and total factor productivity (TFP) off 6.67 per cent per year between 2000 and 2006. Among the various hypotheses put forward to explain these trends, the most robust seems to be that higher output prices have suppressed productivity growth through two effects: increased exploitation of low-productivity marginal deposits, and business decisions based on profitability rather than productivity. Despite the rapid decline in productivity in oil and gas extraction, it is not necessarily true that Canadians are worse off. In fact, increased output prices and employment shares in the industry, as well as the high productivity level, have resulted in positive contributions to Canada‟s aggregate labour productivity growth from 2000 to 2006.
    Keywords: productivity, mining, oil and gas, resource extraction, labour productivity, output per hour, capital intensity, total factor productivity, Canada
    JEL: O13 O30 O51 J00 E23 Q30 D24 J08
    Date: 2009–09
    URL: http://d.repec.org/n?u=RePEc:sls:resrep:0908&r=eff
  4. By: Andrew Sharpe
    Abstract: This report aims to accomplish three objectives: provide an assessment of Canada’s productivity performance; provide a synthesis of the productivity studies conducted by the Centre for the Study of Living Standards (CSLS) and the McKinsey Global Institute; and develop a framework for unbundling slow productivity growth in Canada and the widening productivity gap with the United States.
    Keywords: productivity, labour productivity, output per hour, capital intensity, total factor productivity, Canada, United States, employment, innovation
    JEL: O13 O30 O51 J00 E23 D24 J08
    Date: 2010–02
    URL: http://d.repec.org/n?u=RePEc:sls:resrep:1002&r=eff
  5. By: Clara Inés Pardo Martínez
    Abstract: This paper analyses energy efficiency development in the German and Colombian textile industries as case studies, using three alternative indicators to measure energy efficiency performance. The study analyses energy efficiency in the textile industry at the ISIC three-digit level of aggregation for the years 1998 to 2005. Comparing the results of the three alternative indicators, the German and Colombian textile industries improved their energy efficiency performance during the sample period. The energy consumption of each textile manufacturing activity corresponded to its production level, indicating the direct relation between output and energy use. The results show considerable variation in energy efficiency between the German and Colombian textile industries. A second-stage application of the constant elasticity of substitution (CES) production function reveals that in the German textile industry, capital and energy price variables enhance the efficiency of the gross production-energy ratio, whereas in the Colombian textile industry, labour, materials and plant capacity utilisation variables enhance the efficiency of the gross production-energy ratio. Moreover, in the German textile manufacturing activities, improvements in energy efficiency are achieved mainly through process changes encouraged by energy prices and as an investment strategy, whereas in the Colombian textile manufacturing activities, improvements in energy efficiency are achieved mainly by changes in the production processes, investments in R&D and application of new technologies. These results show the importance of technology, economies of scale, and energy efficiency-oriented policies and management strategies in improving energy efficiency within the textile industry.
    Date: 2009–07–25
    URL: http://d.repec.org/n?u=RePEc:col:000137:006862&r=eff
  6. By: Andrew Sharpe
    Abstract: In recent decades, governments in Canada have pursued market-oriented policies at both the macro and micro levels. Economists believe that such policies should foster productivity growth. Since 2000, however, productivity growth in Canada has been dismal, much below that in the United States and below Canada’s historical trend. The objective of this report is to attempt to explain the paradox of productivity-enhancing public policies and the continuation of poor productivity performance. The report finds that the high degree of market orientation of public policy that already exists in Canada suggests that the productivity-enhancing effects of further liberalization may be quite small.
    Keywords: productivity, labour productivity, output per hour, capital intensity, total factor productivity, Canada, employment
    JEL: O13 O30 O51 J00 E23 D24 J08
    Date: 2010–02
    URL: http://d.repec.org/n?u=RePEc:sls:resrep:1001&r=eff
  7. By: Cette, G.; Kocoglu, Y.; Mairesse, J.
    Abstract: This study compares labor and total factor productivity (TFP) in France, Japan, the United Kingdom and the United States in the very long (since 1890) and medium (since 1980) runs. During the past century, the United States has overtaken the United Kingdom and become the leading world economy. During the past 25 years, the four countries have also experienced contrasting advances in productivity, in particular as a result of unequal investment in information and communication technology (ICT). The past 120 years have been characterized by: (i) rapid economic growth and large productivity gains in all four countries; (ii) a long decline in productivity in the United Kingdom relative to the United States, and to a lesser extent also relative to France and Japan, a relative decline that was interrupted by the second world war (WW2); (iii) the remarkable catching-up to the United States by France and Japan after WW2, interrupted in the case of Japan during the 1990s. Capital deepening (at least to the extent this can be measured) accounts for a large share of the variations in performance; increasingly during the past 25 years, this has meant ICT capital deepening. However, the capital contribution to growth varies considerably over time and across the four countries, and it is always less important, except in Japan, than the contribution of the various other factors underlying TFP growth, such as, among others, labor skills, technical and organizational changes and knowledge spillovers. Most recently (in 2006), before the current financial world crisis, hourly labor productivity levels were slightly higher in France than in the United States, and noticeably lower in the United Kingdom (by roughly 10%) and even lower in Japan (30%), while TFP levels are very close in France, the United Kingdom and the United States, but much lower (40%) in Japan.
    Keywords: Productivity, growth accounting, macro-economic history.
    JEL: O47 O57 E22 J24 N10
    Date: 2010
    URL: http://d.repec.org/n?u=RePEc:bfr:banfra:271&r=eff
  8. By: D.Forrest; M.Jara; D.Paolini; J.D.Tena
    Abstract: This paper studies the effect of the level of a firm?s resources on managerial inefficiency. We motivate our analysis with a theoretical model which predicts that better resourced and therefore more complex institutions tend to be more likely to generate x-inefficiency. The empirical analysis estimates stochastic production frontiers for Chilean and Italian football and finds that, consistent with the theoretical predictions, team performance in the Chilean League is mainly explained by institutional factors related to the level of resources available to a club whereas team performance in the Italian League appears in addition to be related to technical decisions taken by management.
    Keywords: managerial efficiency; stochastic production frontier, sport economics
    JEL: J44 L83 M50
    Date: 2010
    URL: http://d.repec.org/n?u=RePEc:cns:cnscwp:201005&r=eff
  9. By: Thomas J. Holmes; James A. Schmitz, Jr.
    Abstract: Does competition spur productivity? And if so, how does it do so? These have long been regarded as central questions in economics. This essay reviews the literature that makes progress toward answering both questions.
    Keywords: Competition ; Monopolies ; Productivity
    Date: 2010
    URL: http://d.repec.org/n?u=RePEc:fip:fedmsr:439&r=eff
  10. By: Juan Carlos Hallak (Department of Economics, Universidad de San Andres)
    Abstract: We develop a model of international trade with two sources of firm heterogeneity: "productivity" and "caliber". Productivity is modeled as is standard in the literature. Caliber is the ability to produce quality using few fixed inputs. While there is no quality restriction to sell domestically, exporting requires the attainment of minimum quality levels. Compared to single-attribute models of firm heterogeneity emphasizing either productivity or the ability to produce quality, our model provides a more nuanced characterization of firms' export behavior. In particular, it explains the empirical fact that firm size is not monotonically related with export status; there are small firms that export while there are large firms that only operate in the domestic market. The model also delivers novel testable predictions. Conditional on size, exporters sell products of higher quality and at higher prices, they pay higher wages and use capital more intensively. We test these predictions using data on manufacturing establishments in India, the U.S., Chile, and Colombia. The empirical findings confirm the theoretical predictions.
    Keywords: Productivity, quality, exports, firm heterogeneity
    JEL: F10 F12 F14
    Date: 2010–03
    URL: http://d.repec.org/n?u=RePEc:sad:wpaper:99&r=eff
  11. By: Lorenzo Boetti (Catholic University of Milan); Massimiliano Piacenza (Department of Economics and Public Finance "G. Prato", University of Torino); Gilberto Turati (Department of Economics and Public Finance "G. Prato", University of Torino)
    Abstract: In Italy, as in other countries around the world, recent reforms share the goal of increasing the fiscal autonomy of lower tiers of governments, from Regions to Municipalities, in order to align spending with funding responsibilities and increase the efficiency in the provision of essential public services. The purpose of this paper is to assess spending efficiency of local governments and to investigate the effects of tax decentralization, focusing on the role played by incumbent politicians’ accountability. The analysis relies on a sample of Italian municipalities and exploits both parametric (SFA) and nonparametric (DEA) techniques to study spending inefficiency and its main determinants. Consistently with modern fiscal federalism theories, our results show that more fiscally autonomous municipalities exhibit less inefficient behaviours. We also find that the shorter is the distance from new elections, the higher is excess spending, thus giving further support to the traditional “electoral budget cycle” agument. Other political features of governing coalition, such as age and gender of the mayor, do not seem to exert any significant impact on inefficiency levels.
    Keywords: Local governments, Fiscal autonomy, Political accountability, Spending efficiency, Parametric and nonparametric frontiers
    JEL: D72 D78 H71 H72 H77 R51
    Date: 2010–03
    URL: http://d.repec.org/n?u=RePEc:tur:wpaper:11&r=eff
  12. By: Renaud Bourlès (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579); Gilbert Cette (BDF - banque de france - Banque de France, DEFI - Université de la Méditerranée - Aix-Marseille II); Anastasia Cozarenco (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579)
    Abstract: This paper studies the effect of changes in the employment rate on labour productivity per hour, taking an empirical approach. By splitting the workforce into three qualification categories, this study allows us to distinguish the effects of changes in the employment rate structure from those of changes in the qualification structure. With the results obtained, we are then able to emphasise the mechanical effect on GDP, for each country in our panel, of a catch-up with the best practice with respect to employment rate structure and qualification level. It appears that the two effects are more or less of the same magnitude. Moreover, this methodology allows us to rank the countries in our panel depending on the gains they could expect from adopting the best practices in each of the two areas.
    Keywords: Productivity; Growth; Employment; Education
    Date: 2010–03–26
    URL: http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00467107_v1&r=eff

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