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on Efficiency and Productivity |
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Issue of 2011‒12‒13
28 papers chosen by |
| By: | Dong Xiang; Abul Shamsuddin; Andrew C Worthington |
| Keywords: | Stochastic frontier analysis, technical, cost and profit efficiency, banks |
| JEL: | C23 D24 G21 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:gri:fpaper:finance:201119&r=eff |
| By: | Kox, Henk L.M.; Leeuwen, George van |
| Abstract: | The paper proposes a new way of analysing the efficiency of dynamic market selection, based on the persistence of scale economies. The new methodology is used to investigate the causes of stagnating productivity growth in EU business services. An efficient market ensures that more productive firms grow faster than others. Conversely, firms with weaker performance would be outcompeted and shrink, and eventually go broke. This paper uses scale diseconomies and their persistence as indicator for the effectiveness of market selection. We use a DEA method to construct the productivity frontier by sub-sector and size class, for business services in 13 EU countries. From this we derive scale economies and their development over time. Our results indicate malfunctioning competitive selection. Between 1999 and 2005 we observe a persistence of scale diseconomies, with scale efficiency falling rather than growing over time. In panel regressions we find the distance to the productivity frontier (within and between size classes) to be significantly explained by regulatory policies that hamper entry and exit dynamics and labour adjustment, and by a lack of import penetration and domestic start-ups. The results suggest that policy reform and more market openness may have positive productivity effects. This holds for business services itself, but also wider, because of business services’ large role in intermediary production inputs. |
| Keywords: | market selection; scale economies; entry and exit costs; regulation; import competition; EU internal market; productivity frontier |
| JEL: | L25 L5 L84 D2 F14 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:34986&r=eff |
| By: | Malte Reimers (Georg-August-Universität Göttingen / Germany); Stephan Klasen (Georg-August-Universität Göttingen / Germany) |
| Abstract: | While the majority of micro studies finds that rural education increases agricultural productivity, various recent cross‐country regressions analyzing the determinants of agricultural productivity were only able to detect an insignificant or even surprisingly negative effect of schooling. In this paper, we show that this failure to find a positive impact of education in the international context appears to be a data problem related to the inappropriate use of enrolment and literacy indicators. Using a panel of 95 developing and middle‐income countries from 1961 to 2002 that includes data on educational attainment, we show that education indeed has a highly significant, positive effect on agricultural productivity which is robust to the use of different control variables, databases and econometric methods. Distinguishing between different levels of education further reveals that only primary and secondary schooling attainment has a significant positive impact while the effect of tertiary education is insignificant. When distinguishing between income groups, our results indicate that even though the coefficient of the education variable is highly significant and positive for all quintiles, the returns to education are higher for the countries belonging to the richest three quintiles. This finding can be interpreted as support for the claim that education will have larger impacts on agricultural productivity in the presence of rapid technical change since it helps farmers to adjust more readily to the new opportunities provided by technological innovations. |
| Keywords: | Agricultural productivity, agricultural production function, cross‐country regression, education, human capital |
| JEL: | I20 I25 O13 O15 O47 Q10 |
| Date: | 2011–11–18 |
| URL: | http://d.repec.org/n?u=RePEc:got:iaidps:214&r=eff |
| By: | Sala, Hector (Universitat Autònoma de Barcelona); Silva, José I. (University of Girona) |
| Abstract: | In this paper we show that vocational training is an important determinant of productivity growth. We construct a multi-country, multi-sectoral dataset, and quantify empirically to what extent vocational training has contributed to increase the growth rate of labor productivity in Europe between 1999 and 2005. We find that one extra hour of training per employee accelerates the rate of productivity growth by around 0.55 percentage points. |
| Keywords: | continuous vocational training, labor productivity growth |
| JEL: | E22 J24 O41 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6171&r=eff |
| By: | Liu, Jing; Cao, Shutao |
| Abstract: | This paper studies the industry productivity dynamics in China’s manufacturing sector from 1998 to 2007, and in particular, explores to what extent the privatization of state-owned enterprises (SOEs) contributes to the aggregate productivity growth. Our results show that, though non-SOEs on average are more productive than SOEs, the average productivity growth among SOEs is greater than the privately-owned firms. Industry concentration, taxation, and credit market all account for this difference in growth between SOEs and non-SOEs. In addition, industry productivity growth is mainly attributed to the growth of non-SOEs, entry of non-SOE firms, and the exit of SOEs. However, non-SOE firms that are transformed directly from SOEs make a small but negative contribution to industry productivity growth. |
| Keywords: | Productivity Growth, Industry Dynamics, Ownership Change, Reallocation |
| JEL: | E6 D24 O4 |
| Date: | 2011–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:34584&r=eff |
| By: | Alessandra Catozzella (DISCE, Università Cattolica del Sacro Cuore); Marco Vivarelli (DISCE, Università Cattolica del Sacro Cuore) |
| Abstract: | Previous policy evaluation literature mainly aimed at estimating the additional effect of public support on either firms’ innovative inputs or innovative outputs. This paper is an attempt to move one step further, combining the two (input and output) dimensions of innovation into a unique efficiency perspective. To this aim, the impact of public support on the ratio between innovative sales and innovative expenditures (innovative productivity) is estimated using a sample of firm-level data drawn from the third Italian Community Innovation Survey (CIS). A bivariate endogenous switching model has been developed in order to free the analysis of any ex ante sources of sample selection and firm heterogeneity, at the same time getting rid of the two sources of endogeneity potentially affecting the results, i.e. the possible simultaneity between subsidy allocation and the qualitative composition of the innovative output, as well as the endogeneity of public support with respect to innovative performance. Results show that innovative productivity is negatively affected by the public support ; far from ‘doing better’ as a result of government intervention, supported firms appear to exhaust their advantage through merely increasing their innovative expenditures. |
| Keywords: | innovation subsidy; policy evaluation; product innovation; bivariate endogenous switching model |
| JEL: | O32 O38 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:ctc:serie2:dises1177&r=eff |
| By: | Emek Basker |
| Abstract: | Barcodes and barcode scanners transformed the grocery industry in the 1970s. I use store-level data from the 1972, 1977, and 1982 Census of Retail Trade, matched to data on store scanner installations, to estimate scanners’ effect on labor productivity. I find that early scanners increased a store’s labor productivity, on average, by approximately 4.5 percent in the first few years. The effect was larger in stores carrying more packaged products, consistent with the presence of network externalities. Short-run gains were small relative to fixed costs, suggesting that the impediment to widespread adoption of the new technology was profitability, not coordination problems. |
| Keywords: | Barcode scanners, Retail, Supermarkets, Technology, Productivity |
| JEL: | L81 D22 O33 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:11-16r&r=eff |
| By: | Raimundo Soto; Rosalía Vásquez |
| Abstract: | The Kafala (or sponsorship) system is the key instrument behind the economic development of the United Arab Emirates (UAE) and most Middle East economies. The system governs both labor migration and foreign investment by assigning a native-UAE sponsor to each migrant worker and each foreign investor. Sponsors enjoy significant command over these factors and extract sizable economic rents. Firms in free-zones, in contrast, are exempt from the Kafala system. Therefore, they provide an appropriate counterfactual to study the effect of policy regulations on technical efficiency. Using a representative sample of 600 firms of Dubai we estimate stochastic frontier models to identify and compare the degree of technical inefficiency between firms operating under the Kafala system and those in free zones. Our results suggest that on average technical inefficiency resulting from the Kafala amounts to 6.6% of total costs (or 11% of profits). Inefficiency is also greater among firms in Main Dubai in all economic sectors. |
| Keywords: | Labor sponsorship (Kafala), technical inefficiency, economic rents |
| JEL: | D2 L5 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ioe:doctra:399&r=eff |
| By: | Rodrigo Taborda; Julieth Santamaría |
| Abstract: | This paper offers a productivity growth estimate for electric energy commercialization firms in Colombia, using a non-parametric Malmquist bootstrap methodology. The estimation and methodology serve two main purposes. First, in Colombia commercialization firms are subject to a price-cap regulation scheme, a non-common arrangement in the international experience for this part of the industry. Therefore the paper’s result suggest an estimate of the productivity factor to be used by the regulator, not only in Colombia but in other countries where commercialization is a growing part of the industry (renewable energy, for instance). Second, because of poor data collection from regulators and firms themselves, regulation based on a single estimation of productivity seems inappropriate and error-prone. The nonparametric Malmquist bootstrap estimation allows an assessment of the result in contrast to a single one estimation. This would open an opportunity for the regulator to adopt a narrower and more accurate productivity estimation or override an implausible result and impose a productivity factor in the price-cap to foster the development of the industry. |
| Date: | 2011–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:col:000092:009152&r=eff |
| By: | FUKAO Kyoji; Victoria KRAVTSOVA; NAKAJIMA Kentaro |
| Abstract: | In this paper, geographical spillover potential is modeled and empirically examined using factory-level data from Japan's Census of Manufactures. First, the efficiency of each factory is estimated using a non-parametric data envelopment analysis (DEA) model for each industry. Second, the geographical distances to the most efficient factory in the prefecture and Japan overall are estimated. Third, the determinants of the factories' performance are identified and estimated. We find that clustering occurs in each industry, and efficient factories concentrate in certain regions. The percentage of efficient firms out of the total number of firms is particularly high in the Chubu and Tohoku regions. The estimation results also suggest that proximity to the most efficient factories plays a statistically significant role in determining the efficiency of factories in Japan in most industries. However, this is not the case in high-tech industries. |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:11076&r=eff |
| By: | Mizuno, Takayuki; Ishikawa, Atushi; Fujimoto, Shouji; Watanabe, Tsutomu |
| Abstract: | We estimate firm productivity for about 3.2 million firms from 30 countries. We find that the distribution of firm productivity in each country, which is measured by total factor productivity (TFP), has a power law upper tail. However, the power law exponent of a TFP distribution in a country tends to be greater than that of a sales distribution in that country, indicating that the upper tail of a TFP distribution is less heavy compared to that of a sales distribution. We also find that the power law exponent of a TFP distribution tends to be greater than the power law exponents associated with the number of workers or tangible fixed assets. Given the idea that the sales of a firm is determined by the amount of various inputs employed by the firm (i.e., "production function" in the terminology of economics), these results suggest that the heavy tail of a sales distribution in a country comes not from the tail of a TFP distribution, but from the tail of the distribution of the number of workers or tangible fixed assets. |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:hit:cinwps:11&r=eff |
| By: | Valentin Zelenyuk (CEPA - School of Economics, The University of Queensland) |
| Abstract: | In this paper we address an issue of equivalence of primal and dual measures of scale efficiency in general production theory framework. We find that particular types of homotheticity, which we refer to as scale homotheticity, provide necessary and sufficient condition for such equivalence. Specifically, we show that the input scale homotheticity of technology is necessary and sufficient condition for equivalence of primal and dual scale efficiency measures in the input/cost oriented case. Similarly, the output scale homotheticity of technology is necessary and sufficient condition for equivalence of primal and dual scale efficiency measures in the output/revenue oriented case. We also discuss the case when technology is both input scale homothetic and output scale homothetic, as well as indicate about some relationships of scale homotheticity with the homotheticity notions that have already been used in economic theory. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uqcepa:75&r=eff |
| By: | Joseph P. Hughes (Rutgers University) |
| Abstract: | Cost functions and cost efficiency are commonly estimated for industries with detailed data on production and cost, both for firms that are for profit as well as not for profit. The data on not-for-profits obtained from the IRS Form 990 lack these details and, consequently, encourage substitution of the ratio of program expenses to total expenses to gauge performance. While a larger program expense ratio captures better administrative cost efficiency, it does not gauge best-practice cost and the extent to which an organization’s administrative costs exceed best practice. Using the Form 990 data, this study constructs an administrative cost function for not-for-profits and uses the distribution-free technique of estimating a best-practice cost frontier to gauge the relative efficiency of not-for-profit organizations. Focusing on not-for-profit hospitals and their holdings of liquid assets, the empirical evidence is consistent with Jensen’s free cash flow hypothesis: hospitals holding liquid assets in excess of a benchmark have lower program expense ratios and lower cost efficiency. In addition, the CEOs of more cost efficient hospitals earn higher compensation. The agreement of the evidence on agency problems related to excess holdings of liquid assets from the program expense ratio and administrative cost efficiency reinforce the credibility of the latter as a measure of the performance of not-for-profit organizations. |
| Keywords: | not-for-profit, cost efficiency, free cash flow hypothesis |
| JEL: | D24 D22 |
| Date: | 2011–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:rut:rutres:201129&r=eff |
| By: | Aldieri, Luigi |
| Abstract: | In this paper we analyze the relationship between R&D spillovers and productivity. To this aim, we use data from 9th and 10th “Indagine sulle imprese manifatturiere” (IMM) surveys carried out by Capitalia. These two surveys, which cover the period 2001-2006, contain both quantitative and qualitative information on a large sample of Italian firms. The main contribution of this paper is to stress the importance of replacing the traditional high-tech/low-tech industries with a classification more suitable to capture the nature of new technologies. Indeed, the industry data are summarised in a particular taxonomy, according to Pavitt methodology: Supplier dominated, Scale intensive, Specialized suppliers and Science based. This taxonomy accounts for differences in the knowledge intensity and innovative activities within sectors. The estimation method takes into account the endogeneity of regressors and simultaneity issue regarding firms’ decision to invest in R&D. The results provide evidence of higher productivity in R&D intensive industries and this can be interpreted as the signal of the relevance of spillover effects. |
| Keywords: | Industry taxonomies; R&D; Productivity; Spillovers |
| JEL: | D62 C23 D24 O3 |
| Date: | 2011–11–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35018&r=eff |
| By: | Marek Hudon; Anaïs Périlleux |
| Abstract: | We use an innovative methodology to analyze social responsibility in double bottom line institutions such as microfinance institutions. We provide empirical evidence on the distribution of the generated surplus between the key stakeholders of one of the most famous MFIs worldwide: Banco Compartamos. Our results suggest that productivity gains generated by the institution have been primarily kept as gross self-financing margin for future investments or dividends for investors. |
| Keywords: | microfinance; governance; Compartamos; productivity |
| JEL: | O16 O50 G21 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:sol:wpaper:2013/104631&r=eff |
| By: | Biewen, Martin (University of Tuebingen); Weiser, Constantin (University of Mainz) |
| Abstract: | We address the long standing question of whether production factors are paid their marginal products. We propose a new approach that circumvents the need to specify production functions and to compare marginal products to factor payments. Our approach is based on a simple equation that directly relates firms' profits to discrepancies between factor payments and marginal products. Our empirical application using data on manufacturing firms suggests that capital receives more than its marginal product, intermediate inputs receive less, and labor receives about its marginal product. Although there are differences with respect to firm size, deviations from marginal productivity theory generally seem limited. Our results have important implications for the distribution of income, the presence of optimizing behavior, and the existence of market power. |
| Keywords: | marginal productivity theory, distribution of income, robust statistics |
| JEL: | D33 D22 D40 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6113&r=eff |
| By: | Chambers, Christopher P. (Department of Economics, University of California); Miller, Alan D. (Faculty of Law and Department of Economics, University of Haifa) |
| Abstract: | We introduce an ordinal model of efficiency measurement. Our primitive is a notion of efficiency that is comparative, but not cardinal or absolute. In this framework, we postulate axioms that we believe an ordinal efficiency measure should satisfy. Primary among these are choice consistency and planning consistency, which guide the measurement of efficiency in a firm with access to multiple technologies. Other axioms include symmetry, which states that the names of commodities do not matter, scale-invariance, which says that units of measurement of commodities does not matter, and strong monotonicity, which states that efficiency should decrease if the inputs and outputs remain static when the technology becomes unambiguously more efficient. These axioms characterize a unique ordinal efficiency measure which is represented by the coefficient of resource utilization. By replacing symmetry (the weakest of our axioms) with a very mild continuity condition, we obtain a family of path-based measures. |
| Keywords: | Efficiency Measurement, Coefficient of Resource Utilization, Ordinal, Choice Consistency, Planning Consistency, Path-based |
| JEL: | C43 D24 |
| Date: | 2011–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:haf:huedwp:wp201114&r=eff |
| By: | Giulio Bottazzi (LEM - Laboratory of Economics and Management - Sant'Anna School of Advanced Studies); Giovanni Dosi (LEM - Laboratory of Economics and Management - Sant'Anna School of Advanced Studies); Nadia Jacoby (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne); Angelo Secchi (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne); Federico Tamagni (LEM - Laboratory of Economics and Management - Sant'Anna School of Advanced Studies) |
| Abstract: | Diverse theories of industry dynamics predict heterogeneity in production efficiency to be the driver of firms' growth, survival and industrial change, either through a direct link between efficiency and growth, or through an indirect effect via profitabilities, as more productive firms can enjoy higher profit margins which, under imperfect capital markets, allow them to invest and grow more. Does the empirical evidence bear such predictions? This paper explores the dynamics of selection and reallocation through an investigation of the productivity-profitability-growth relations at the firm level. Exploiting large panels of Italian and French industrial firms, we find that heterogeneity in efficiencies primarily yield persistent profitability differentials, whereas the relationships of corporate growth with either productivity or profitability appear much weaker, if at all existent. This suggests that selection forces are much less strong than usually assumed. The results robustly applies across different industrial sectors and across the two countries. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-00642692&r=eff |
| By: | Ma, Shuang; Sun, Churen; Tian, Guoqiang |
| Abstract: | This paper proposes a two-country trade equilibrium model with heterogeneous firms to investigate the influences of minimum wages and productivity on firms' exports. It shows that the influence of minimum wages on firms' exporting probability and foreign sales is negative while that of firms' productivity on their exports is positive. Econometric analysis based on the Annual Survey of Chinese Industrial Firms as well as the data of minimum wages collected ourselves from 1998 to 2007 verifies these predictions. Holding the other variables constant, if minimum wages and their productivity increase by 100%$, then the elasticity of minimum wage on firms' exporting sales is -8.6% while that of firms' productivity is 75.6%, and firms' exporting possibility decreases by 1.1%$ and increases by 1.6%$, respectively. |
| Keywords: | Minimum wage; heterogeneous firm; productivity; export |
| JEL: | F16 L25 F12 |
| Date: | 2011–07–22 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35098&r=eff |
| By: | María Jesus Herrerias (Université de la Méditerranée Aix Marseille II, GREQAM); Javier Ordóñez (Department of Economics, Universitat Jaume I (Castellón, Spain)) |
| Abstract: | A new panel method is applied to the case of Chinese provinces to analyze the existence of club convergence in terms of per capita income, labor productivity, capital intensity, and total factor productivity from 1952 to 2008. The advantage of this approach is that it takes into account the heterogeneity of Chinese regions in a nonlinear time-varying framework, where more attention is paid to the spatial dimension. This time-varying approach outperforms other methods used in the relevant literature for an economy in transition, such as China, that has undergone a significant transformation over the period under consideration. Our results indicate that Chinese regions have converged into clubs. However, it is observed that Heilongjiang is diverging in terms of labor productivity and capital intensity, while Liaoning and Guizhou display similar patterns in terms of labor productivity, and Shanxi and Hebei in terms of capital intensity. These results indicate that specific economic packages need to be implemented in the clusters that were identified, with special attention to those regions that show a divergence behavior, in order to guarantee the sustainability and equality of regional growth. |
| Keywords: | Endogenous Unit Root Test, Club Convergence, Chinese regions |
| JEL: | C20 O18 O40 R11 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:jau:wpaper:2011/7&r=eff |
| By: | de Grip, Andries (ROA, Maastricht University); Sauermann, Jan (ROA, Maastricht University); Sieben, Inge (Tilburg University) |
| Abstract: | In this paper, we estimate tenure-performance profiles using unique panel data that contain detailed information on individual workers' performance. We find that a 10 per cent increase in tenure leads to an increase in performance of 5.5 per cent of a standard deviation. This translates to an average performance increase of about 75 per cent within the first year of the employment relationship. Furthermore, we show that there are peer effects in learning on-the-job: Workers placed in teams with more experienced and thus more productive peers perform significantly better than those placed in teams with less experienced peers. An increase in the average team tenure by one standard deviation leads to an increase of 11 to 14 per cent of a standard deviation in performance. |
| Keywords: | tenure-performance profiles, experience, learning on-the-job, peer effects, productivity, call centres |
| JEL: | J24 D24 L89 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6164&r=eff |
| By: | Joseph J. Hughes (Rutgers University); Loretta Mester (Federal Reserve Bank of Philadelphia) |
| Abstract: | Earlier studies found little evidence of scale economies at large banks; later studies using data from the 1990s uncovered such evidence, providing a rationale for very large banks seen worldwide. Using more recent data, we estimate scale economies using two production models. The standard risk-neutral model finds little evidence of scale economies. The model using more general risk preferences and endogenous risk-taking finds large scale economies. We show that these economies are not driven by too-big-to-fail considerations. We evaluate the cost implications of breaking up the largest banks into banks of smaller size. |
| Keywords: | banking, production |
| JEL: | D21 D20 |
| Date: | 2011–08–02 |
| URL: | http://d.repec.org/n?u=RePEc:rut:rutres:201127&r=eff |
| By: | Silvia CODERONI (INEA (National Institute for Agricultural Economics), Rome - Italy); Roberto ESPOSTI (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali) |
| Abstract: | The paper adopts a long single-country panel dataset (Italian regions) to analyse the relationship between agricultural GreenHouse Gases (GHG) emissions and agricultural productivity growth and, thus, to assess emissions sustainability. The modelling approach and the empirical specification include the Environmental Kuznets Curve (EKC) as one of the possible outcomes. The hypothesis of emission sustainability is assessed by estimating alternative panel model specifications with conventional and GMM estimators. The adopted panel concerns the 1951-2008 and 1980-2008 emissions of methane and nitrous oxide properly reconstructed for the Italian regional agriculture. Results suggest that, though a significant relationship between agricultural GHG emissions and productivity growth may exist, it tends to be monotonic. Therefore, even if sustainability is accepted for some GHG, no robust evidence of the EKC emerges across the different specifications, estimators and periods. |
| Keywords: | Agricultural GreenHouse Gases Emissions, Dynamic Panel Models, Environmental Kuznets Curve, Italian Regions |
| JEL: | O13 Q15 Q54 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:369&r=eff |
| By: | Emanuela Marrocu; Raffaele Paci; Stefano Usai |
| Abstract: | The purpose of this paper is to analyse the effect of various proximity dimensions on the innovative capacity of 276 regions in Europe within a knowledge production function model, where R&D and human capital are included as the main internal inputs. We combine the standard geographical proximity with the institutional, technological, social and organizational ones to assess whether these externalities are substitutes or complements in channelling knowledge spillovers. Results show that all proximities have a significant complementary role in generating an important flow of knowledge across regions, with the technological closeness playing the most relevant role. |
| Keywords: | knowledge production; spillovers, proximity; human capital; weight matrix |
| JEL: | O31 R12 C31 O52 O18 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201121&r=eff |
| By: | Montgomery, Heather; Takahashi, Yuki |
| Abstract: | The Japanese “Big Bang” financial deregulations started in 1996. The objective was to make the Japanese banking sector more “free, fair and global”, spurring competition and resulting in a more profitable and efficient financial sector. The Big Bang brought about a massive consolidation of Japan’s already relatively concentrated banking sector. Japan’s “Top 20” banks have now merged to just three financial conglomerates that are among the largest in the world. Is this a sign of the success? Focusing on the Big Bang’s stated objectives of promoting profitability and efficiency, this study examines the Japanese “Big Bang” deregulation from its start in 1996 to completion in 2001, and the following eight years. On profitability, we find that the banking sector as a whole did not become more profitable than the pre-deregulation period. Rather, we see a steady decline in profitability. In addition, the main targets of the deregulation (and the most active in mergers and acquisitions activity during our sample period), the city, trust and long-term credit banks, actually exhibit lower profitability measured in ROA and ROE than the smaller regional banks. The “Big Bang” did not succeed in promoting a more profitable banking sector. We next turn to efficiency. We find that in terms of cost reduction, the banking sector did become more efficient after the Big Bang deregulation. However, the real bottom line of performance, profit efficiency, declined. In addition, we again see a significant difference between the big city, trust long-term credit banks and the smaller regional banks. The biggest banks are statistically significantly less profit efficient, despite their higher cost efficiency. Thus, on the whole, the Japanese “Big Bang” financial deregulation was not successful in achieving its stated objectives. Both profitability and efficiency declines on the whole, and the main targets of the deregulation, the big city, trust and long-term credit banks, exhibit statistically significantly lower profitability and efficiency than their smaller counterparts. |
| Keywords: | deregulation; profitability; efficiency |
| JEL: | G28 G21 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35040&r=eff |
| By: | Miguel A. León-Ledesma (School of Economics, University of Kent, Kent CT2 7NP, United Kingdom.); Peter McAdam (European Central Bank, Research Department, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany and visiting Professor of Economics at the University of Surrey.); Alpo Willman (European Central Bank, Research Department, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.) |
| Abstract: | We examine the two-level nested Constant Elasticity of Substitution production function where both capital and labor are disaggregated in two classes. We propose a normalized system estimation method to retrieve estimates of the inter- and intra-class elasticities of substitution and factoraugmenting technical progress coefficients. The system is estimated for US data for the 1963-2006 period. Our findings reveal that skilled and unskilled labor classes are gross substitutes, capital structures and equipment are gross complements, and aggregate capital and aggregate labor are gross complements with an elasticity of substitution close to 0.5. We discuss the implications of our findings and methodology for the analysis of the causes of the increase in the skill premium and, by implication, inequality in a growing economy. JEL Classification: E25, J23, J24, O40. |
| Keywords: | Two-level CES production function, factor-augmenting technical progress, factor substitution, aggregation, skill-premium. |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20111400&r=eff |
| By: | YAMAGUCHI Kazuo |
| Abstract: | This paper employs a macro-data analysis of GDP per hour among the Organisation for Economic Co-operation and Development (OECD) countries and a micro-data analysis of the performance of Japanese firms, and examines how Gender Empowerment Measure (GEM) is associated with GDP per hour, and how the work-life balance (WLB) practices of firms affect their performance, measured by the gross margin per employee or per hour for the employees' total hours of work. Since gross margin can take on negative values, the analysis that uses the logarithm of gross margin per employee or per hour as the dependent variable employs the Tobit regression model. The results of the analyses show the following. While GEM has no unique association with GDP per capita, controlling for the Human Development Index (HDI), it shows a significant positive association with GDP per hour, controlling for HDI, and thereby suggests the association of the utilization of women's human resources with productivity per hour. Among Japanese firms, those that have concrete WLB practices and consider "encouraging employees to fulfill their potential regardless of gender" as very important in their management practices more so than other firms perform better, but they are still scarce in Japan. Unlike the results for male regular employees, firms' performance does not depend on the educational composition of female regular employees, thereby suggesting that Japanese firms on average fail to utilize the human resources of highly educated women. However, controlling for the gender ratio of regular employees, firms with a higher ratio of women in their managerial/administrative positions demonstrate better performance. In addition, as the ratio of women in managerial/administrative positions increases, a positive effect of the average educational attainment of female employees on firms' performance emerges. However, the average ratio of women in managerial/administrative positions is still very low among Japanese firms. The policy implications of those findings are also discussed. |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:11069&r=eff |
| By: | Alessio Moro (University of Cagliari); Galo Nuño (Banco de España) |
| Abstract: | Housing prices diverge from construction prices after 1997 in four major countries. Besides, TFP differences between construction and the general economy account for the evolution of construction prices in the U.S. and Germany, but not in the U.K. and Spain. |
| Keywords: | Housing prices, TFP, growth accounting, Cobb-Douglas |
| JEL: | E01 E23 E25 E32 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:1133&r=eff |