New Economics Papers
on Efficiency and Productivity
Issue of 2013‒06‒16
27 papers chosen by

  1. Development of Total Factor Productivity in Alpine Farming - A Malmquist index approach - By Kantelhardt, J.; Kapfer, M.; Franzel, M.; Kirchweger, S.
  2. Environmental and Economic Impact of Agricultural Land Use - a Spatially Explicit DEA Approach - By Kapfer, M.; Kantelhardt, J.; Eckstein, K.; Hübner, R.
  3. CAP Subsidies and the Productivity of EU Farms By Rizov, Marian; Pokrivcak, Jan; Ciaian, Pavel
  4. Measuring the sources of economic growth in the EU with parametric and non-parametric methods By Krasnopjorovs, Olegs
  5. Dealing with the Endogeneity Problem in Data Envelopment Analysis By Cordero, José Manuel; Santín, Daniel; Sicilia, Gabriela
  6. Productivity and age: Evidence from work teams at the assembly line By Weiss M.; B?rsch-Supan A.
  7. Importing, productivity and SMEs: firm-level evidence from the Netherlands By Marcel van den Berg
  8. Allocation and industry productivity: Accounting for firm turnover By Maliranta, Mika; Määttänen, Niku
  9. Measuring the Influence of Networks on Transaction Costs Using a Non-parametric Regression Technique By Géraldine Henningsen; Arne Henningsen; Christian H.C.A. Henning
  10. Multifactor Productivity Measurement at Statistics Canada By Baldwin, John R.<br /> Gu, Wulong
  11. The age-productivity pattern: Do location and sector affiliation matter? By Mahlberg, Bernhard; Freund, Inga; Crespo Cuaresma, Jesús; Prskawetz, Alexia
  12. Exports and productivitgy: does destination matter? By Adriana Peluffo; Juan Barboni; Nicolás Ferrari; Hanna Melgarejo
  13. Farms’ Performance and Short Supply Chains in Italy: an Econometric Analysis By Bonanno, A.; Cembalo, L.; Caracciolo, F.; Dentoni, D.; Pascucci, S.
  14. Good Firms, Worker Flows and Productivity By Serafinelli, Michel
  15. Exporting and Innovation: Theory and Firm-Level Evidence from the People's Republic of China By Lin, Faqin; Tang, Hsiao Chink
  16. The Neighborhood or the Region? Untangling the density-productivity relationship using geocoded data By Larsson, Johan P.
  17. The Capitalization of Area Payment into Land Rental Prices: Micro-evidence from Italy By Moro, D.; Guastella, G.; Sckokai, P.; Veneziani, M.
  18. Off-farm labour participation of Italian farmers, state dependence and the CAP reform By Corsi, A.; Salvioni, C.
  19. Innovation and firm growth: Does firm age play a role? By Coad, Alex; Segarra Blasco, Agustí, 1958-; Teruel, Mercedes
  20. The Impact of Information Technology Outsourcing on Productivity and Output: New Evidence from India By Grace Kite
  21. R&D Strategy, Metropolitan Externalities and Productivity By Lööf, Hans; Johansson, Börje
  22. Production costs of Soft Wheat in Italy By Tiberti, M.
  23. From state to market revisited: more empirical evidence on the efficiency of public (and privately-owned) enterprises By Mühlenkamp, Holger
  24. A spatial econometric approach to assess the impact of RDPs agri-environmental measures on the use of Nitrogen in agriculture: the case study of Emilia-Romagna (Italy) By Marconi, V.; Raggi, M.; Viaggi, D.
  25. Energy Intensity Developments in 40 Major Economies: Structural Change or Technology Improvement? By Enrica De Cian; Michael Schymura; Elena Verdolini; Sebastian Voigt
  26. Determinants of Bank Asset Quality and Profitability - An Empirical Assessment By Swamy, Vighneswara
  27. Financial Development, Bank Efficiency and Economic Growth across the Mediterranean By Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter

  1. By: Kantelhardt, J.; Kapfer, M.; Franzel, M.; Kirchweger, S.
    Abstract: In comparison to flatland agriculture mountainous agriculture is often shaped by small plot sizes, unfavourable climatic conditions and steep slopes. All those conditions make it extraordinarily expensive to implement new technologies and to modernise farms. Consequently our research hypothesis is that technical progress in mountainous regions is slower in comparison to flatland regions. In order to test this hypothesis we develop a model combining a Malmquist index approach with a matching analysis. We apply our model in Austria, using a panel data set comprising the data of 1034 Austrian voluntarily bookkeeping farms and ranging from 2003 to 2009. On basis of the Austrian Mountain Farm Cadastre the farms are classified into five categories expressing the degree of disadvantage which farms are exposed from being located in a mountainous area. Our results show that technical change in mountain regions is significantly lower than in flatland regions and continuously decreasing with increasing disadvantage. Matching our results shows that this result is mainly based on farm grassland share, while farm size is of minor importance. With regard to efficiency change and change of total factor productivity we do not find any significant results.
    Keywords: Malmquist total factor productivity index, technical progress, Alpine farming, data envelopment analysis, matching, Production Economics, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies, C14, C67, Q12,
    Date: 2013–06
  2. By: Kapfer, M.; Kantelhardt, J.; Eckstein, K.; Hübner, R.
    Abstract: Agriculture produce commodities and but also influence the environment. However, even if the value of commodities is easy to determine, it is difficult to assess the efficiency of agricultural production at site level. Furthermore, the valuation of environmental impact is complex. Non-parametric approaches such as DEA allow for an assessment of environment and economic performance. We implement a plot-specific approach combining GIS and DEA models. This allows a spatially explicit assessment of agricultural land use for different subjects such as ecology and economy. In a second stage DEA-model, the impact of farm- and site-specific characteristics on efficiency is analysed.
    Keywords: agricultural land use, data envelopment, environment-oriented technical efficiency, economy-oriented technical efficiency, Environmental Economics and Policy, Land Economics/Use, Productivity Analysis, Q12, Q26, Q57,
    Date: 2013–06
  3. By: Rizov, Marian; Pokrivcak, Jan; Ciaian, Pavel
    Abstract: This paper investigates the impact of subsidies from the common agricultural policy on the total factor productivity of farms in the EU. We employ a structural, semi-parametric estimation algorithm, directly incorporating the effect of subsidies into a model of unobserved productivity. We empirically study the effects using samples from the Farm Accountancy Data Network for EU-15 countries. Our main findings are clear: subsidies had a negative impact on farm productivity in the period before the decoupling reform was implemented; after decoupling the effect of subsidies on productivity was more nuanced, as in several countries it turned positive.
    Date: 2013–03
  4. By: Krasnopjorovs, Olegs
    Abstract: The standard neoclassical growth accounting (parametric) framework serves to explain only a minor part of labour productivity growth and its cross-country differences, thus implying an important role (as yet unexplained) for the Solow Residual or the Total Factor Productivity (TFP). However, the increased application of non-parametric methods in growth accounting, and in particular with Data Envelopment Analysis (DEA), has revealed that, along with the direct effect on output, a higher capital stock will have a substantial indirect effect that has been disregarded by the neoclassical framework. In line with an appropriate technology model (Basu, Weil, 1998), a higher capital stock allows a country to use a better technology. This paper extends the evidence regarding the relevance of an appropriate technology view to those Eastern European countries that were not previously included in a growth accounting investigation using non-parametric methods. It also reveals that the appropriate technology view is useful in explaining labour productivity growth and its cross-country differences within the EU. Furthermore, the results are robustly subject to assumptions on capital formation and on whether labour productivity has been adjusted with regard to the cross-country differences in employment structure by the various sectors and by natural resource endowment. Given both the direct and indirect effects of capital accumulation, it might prove to be a much more important tool for determining labour productivity growth than is usually considered within a neoclassical framework.
    Keywords: growth accounting, development accounting, Data Envelopment Analysis, efficiency, appropriate technology, total factor productivity
    JEL: C14 E22 O33 O47 Q32
    Date: 2012–12–01
  5. By: Cordero, José Manuel; Santín, Daniel; Sicilia, Gabriela
    Abstract: Endogeneity, and the distortions on the estimation of economic models that it causes, is a familiar problem in the econometrics literature. Although non-parametric methods like data envelopment analysis (DEA) are among the most used techniques for measuring technical efficiency, the effects of endogeneity on such efficiency estimates have received little attention. The aim of this paper is twofold. First, we further illustrate the endogeneity problem and its causes in production processes like the correlation between one input and the efficiency level. Second, we use synthetic data generated in a Monte Carlo experiment to analyze how different levels of positive and negative endogeneity can impair DEA estimations. We conclude that although DEA is robust to negative endogeneity, a high positive endogeneity level, i.e., a high positive correlation between one input and the true efficiency level, significantly and severely biases DEA performance.
    Keywords: Technical efficiency, DEA, Endogeneity, Monte Carlo.
    JEL: C6 C9
    Date: 2013–04
  6. By: Weiss M.; B?rsch-Supan A. (GSBE)
    Abstract: We study the relation between workers age and their productivity in work teams, based on a new and unique data set that combines data on errors occurring in the production process of a large car manufacturer with detailed information on the personal characteristics of workers related to the errors. We correct for non-random sample selection and the potential endogeneity of the age-composition in work teams. Our results suggest that productivity in this plant which is typical for large-scale manufacturing does not decline at least up to age 60.
    Keywords: Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity; Economics of the Elderly; Economics of the Handicapped; Non-labor Market Discrimination; Human Capital; Skills; Occupational Choice; Labor Productivity;
    JEL: J24 J14 D24
    Date: 2013
  7. By: Marcel van den Berg
    Abstract: Constructing a comprehensive data set covering Dutch firms over the years 2002-2008 I am the first to investigate the relationship between trade status, firm size and firm-level productivity in the Netherlands, thereby focusing particularly on small and medium sized enterprises (SMEs). The empirical evidence can be summarized in four stylized facts. The productivity ranking by trade status of Dutch manufacturing firms in increasing order of productivity is: non-traders, importers, exporters and two-way traders. Firm size and being controlled by a company located abroad are positively associated with firm-level productivity. The results point in the direction of self-selection of more productive manufacturing firms into importing, particularly for firms that did not trade altogether prior to the import start and for build-up periods of two and three years towards the import start. I do not find evidence that firms become more productive after an import start because of learning effects. I find considerable heterogeneity in the productivity premia of trade along the firm size distribution. The results suggest that exporting is more complex than sourcing inputs internationally for small firms relative to larger firms.
    Keywords: Micro data, firm heterogeneity, imports, exports, productivity, the Netherlands
    JEL: D22 F14 F23
    Date: 2013–06
  8. By: Maliranta, Mika; Määttänen, Niku
    Abstract: Recent macroeconomic literature has stressed the importance of resource allocation between firms for aggregate productivity. An important issue, therefore, is how to measure allocative efficiency. We compare popular indicators of allocative efficiency, paying special attention to firm turnover. We first show how entering and exiting firms contribute to aggregate productivity and to the Olley-Pakes (OP) covariance component, which is currently the most popular measure of allocative efficiency. Our data cover essentially all firms and plants in the Finnish business sector. We then build a model of firm dynamics with endogenous turnover that is consistent with the main patterns of our empirical results and use it to test how well alternative indicators capture different allocation distortions. Our results demonstrate how and why commonly used indicators fail to capture certain distortions because of endogenous changes in firm turnover.
    Keywords: productivity; firm dynamics; reallocation
    JEL: E23 L16 O47
    Date: 2013–05–27
  9. By: Géraldine Henningsen (DTU Management Engineering, Technical University of Denmark); Arne Henningsen (Department of Food and Resource Economics, University of Copenhagen); Christian H.C.A. Henning (Institute of Agricultural Economics, Christian-Albrechts University Kiel)
    Abstract: All business transactions as well as achieving innovations take up resources, subsumed under the concept of transaction costs. One of the major factors in transaction costs theory is information. Firm networks can catalyse the interpersonal information exchange and hence, increase the access to non-public information so that transaction costs are reduced. Many resources that are sacrificed for transaction costs are inputs that also enter the technical production process. As most production data do not distinguish between these two usages of inputs, high transaction costs result in reduced observed productivity. We empirically analyse the effect of networks on productivity using a cross-validated local linear non-parametric regression technique and a data set of 384 farms in Poland. Our empirical study generally supports our hypothesis that networks affect productivity. Large and dense trading networks and dense information networks and household networks have a positive impact on a farm’s productivity. A bootstrapping procedure confirms that this result is statistically significant.
    Keywords: Information networks, Transaction Costs, Non-parametric estimation, Productivity analysis
    JEL: D22 D23 D24 L14 Q12
    Date: 2013–05
  10. By: Baldwin, John R.<br /> Gu, Wulong
    Abstract: This paper describes the evolution of the Multifactor Productivity Program launched at Statistics Canada in 1987 and the improvements made in multifactor productivity measurement since then. The improvements were made in response to developments in the economic literature, better data sources, and the needs of the user community. The paper also summarizes research that uses alternate data and methodologies to assess the accuracy of the Multifactor Productivity Program and to provide insights into areas that traditional international multifactor productivity programs omit. Finally, the paper outlines future directions that are being contemplated to further improve the measurement of productivity at Statistics Canada.
    Keywords: Economic accounts, Productivity accounts
    Date: 2013–05–28
  11. By: Mahlberg, Bernhard; Freund, Inga; Crespo Cuaresma, Jesús; Prskawetz, Alexia
    Abstract: Current demographic developments are expected to challenge the sustainability of welfare in industrialised economies. Persistent low fertility levels and increasing survival rates to older age imply a decreasing share of younger individuals within the labour force that needs to support an increasing share of old people out of the labour force. We use matched employeremployee data for Austria at the firm level in order to study the link between the age structure and labour productivity and concentrate on the role played by regional location and sector affiliation. We apply multilevel estimation techniques in order to account for systematic variation of the age-productivity pattern with regard to these two dimensions. Our results indicate that the age-productivity pattern differs significantly across regions and across sectors and that sectoral differences are the more sizable source of heterogeneity in the link between the age structure and firm productivity. --
    Keywords: age-productivity profile,firm heterogeneity,employer-employee data,multilevel regression methods,regional variability,sectoral variability
    JEL: C21 J14 J24 J82 R11
    Date: 2013
  12. By: Adriana Peluffo (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Juan Barboni (Despegar. Análisis de Riesgo); Nicolás Ferrari (Axiona. Sociedad de Soluciones); Hanna Melgarejo (Agencia de Gobierno Electrónico y Sociedad de la Información (AGESIC). Sistema De Compras y Contrataciones Estatales)
    Abstract: In this work we analyse the effect of export destinations on Total Factor Productivity (TFP) of manufacturing Uruguayan firms for the period 1997-2006. We study two effects: self-selection and learning by exporting. To this end, we work with a panel of firms –provided by the Instituto Nacional de Estadisticas- and the destiny of exports - provided by the Dirección Nacional de Aduanas-. We estimate TFP using the Levinsohn & Petrin (2003) methodology. Results for Pooled Ordinary Least Squares estimations show the association between firms with higher share of their total exports to developed countries and higher TFP than firms exporting to less developed countries. Nevertheless, applying the transition group methodology (Alvarez & López 2005) in order to mitigate endogeneity issues, there is no evidence that exporting to developed countries enhances productivity through learning by exporting. However, evidence of learning by exporting is found for those firms starting to export to less developed countries. These findings suggest an international strategy through which firms reach gains in productivity exporting to markets with lower entry cost, and once they have learnt and improved their productivity, are in a better position to enter into more developed countries.
    Keywords: Total factor productivity, exports, destiny of exports, auto-selection, learning by exporting
    JEL: D21 D24 F14 O54
    Date: 2013–05
  13. By: Bonanno, A.; Cembalo, L.; Caracciolo, F.; Dentoni, D.; Pascucci, S.
    Abstract: In spite of several cases study existing that assess the profitability of farms participating in direct sales activities (Brown, 2002; Brown and Miller (2008), no analysis has verified whether the notion that farmers participating in short supply chains are profitable holds to the empirical test. The objective of this analysis is that of testing econometrically whether farmers joining short supply chains do experience better performances, accounting for confounding factors and endogeneity of channel choice decision. To that end, we use the Farm Accountancy Data Network (FADN) referred to 2010. Results indicate that participation in SSCs doesn’t positively contribute to farms profitability. We use this preliminary empirical evidence to shape future research steps in this domain, and namely to further investigate the differential impact of participation in SSCs on gross sales and variable costs.
    Keywords: short supply chains, Price-Cost-Margin, GMM, Italy, Farm Management, Productivity Analysis, Q13,
    Date: 2013–06
  14. By: Serafinelli, Michel
    Abstract: I present direct evidence on the role of firm-to-firm labor mobility in enhancing the productivity of firms located near highly productive firms. Using matched employer-employee and balance sheet data for the Veneto region of Italy, I identify a set of high-wage firms (HWF) and show they are more productive than other firms. I then show that hiring a worker with HWF experience increases the productivity of other (non-HWF) firms. A simulation indicates that worker flows explain 10-15 percent of the productivity gains experienced by other firms when HWFs in the same industry are added to a local labor market.
    Keywords: productivity, agglomeration advantages, linked employer-employee data, labor mobility.
    JEL: J24 J31 J61 R2 R23
    Date: 2013–06–09
  15. By: Lin, Faqin (Central University of Finance and Economics); Tang, Hsiao Chink (Asian Development Bank)
    Abstract: This paper investigates how exporting affects firm innovation. We embed innovation into a firm heterogeneity model with productivity, where in equilibrium the model shows that exporters invest more in innovation, such as research and development (R&D), than non-exporters. Using firm-level data from the People’s Republic of China (PRC), we apply the Levinsohn and Petrin (2003) method of estimating firm productivity and matching econometrics to control for endogeneity. The results show, on average, in contrast to non-exporters, exporters increase their R&D intensity by more than 5%, raise their R&D expenditure by more than 33%, and are 4% more likely to engage in R&D activity. In addition, we find exporting to have a smaller impact on innovation among firms that export processed goods, specifically, those in the electronics sectors, located in coastal provinces, and foreign-owned.
    Keywords: Exporting; innovation; firm heterogeneity; matching
    JEL: D21 F14 O31
    Date: 2013–04–01
  16. By: Larsson, Johan P. (Centre for Entrepreneurship and Spatial Economics (CEnSE), Jönköping International Business School.)
    Abstract: I analyze the effects of sub-city level density of economic activity on worker productivity. Using a geocoded dataset on employment and wages in the city areas of Sweden, the analysis is based on squares representing “neighborhoods” (0.0625 km2), “districts” (1 km2), and “agglomerations” (10 km2). The wage-density elasticity depends crucially on spatial resolution, with the elasticity being highest in neighborhood squares. The results are consistent with i) the existence of a localized density spillover effect and ii) quite sharp attenuation of human capital spillovers. An implication of the findings is that if the data source is not sufficiently disaggregated, analyses of the density-productivity link risk understating the benefits of working in dense parts of regions, such as the central business districts.
    Keywords: Density; productivity; spatial dependence; geo-coded data; neighborhood effects; human capital; agglomeration economies
    JEL: J24 J31 R12
    Date: 2013–06–12
  17. By: Moro, D.; Guastella, G.; Sckokai, P.; Veneziani, M.
    Abstract: This paper analyses the extent to which agricultural subsidies are capitalised into land rental price. By using Italian data at the farm level the analysis proposed in this paper innovates with respect to existing studies in different ways. Thanks to the long time span available in the FADN database it is possible to compare the two time periods, before and after the 2005 CAP reform, to test whether any change occurred as a result of the introduction of the decoupled payments scheme. In contrast to previous empirical literature, which has either focused on the unobserved farm-level heterogeneity issue or on the selectivity issue, the method proposed in this paper accounts for both simultaneously. Finally, the same method is extended to account for endogeneity of some covariates. Overall, the results in the paper confirm previous evidence, rejecting the hypothesis that agricultural payments are capitalized into land prices in both periods.
    Keywords: Sample selection, Panel Data, Capitalization Effect, Italian Farms, Land Economics/Use, C33, Q15, Q18,
    Date: 2013–06
  18. By: Corsi, A.; Salvioni, C.
    Abstract: We analyse the determinants of off-farm labour participation of farmers, an issue relevant in view of the agricultural sector coping with increasing productivity and in terms of rural development. We apply a farm-household theoretical model. The data for the empirical analysis are a 5 year (2003-2007) balanced panel of 3294 Italian farms, drawn from the Farm Accounting Data Network. The explanatory variable is the dummy indicator of the farm operator working or not off the farm. The explanatory variables comprise personal, household, and farm characteristics, and few variables of the local labour market. Since in the period a major reform of the Common Agricultural Policy (CAP) took place, we also add related variables. For estimation, we use different dynamic models, accounting for both heterogeneity and state dependence, as well as for the initial conditions (Heckmann, 1981; Wooldridge, 2005; Orme, 2001). Our results suggest that, when keeping into account all these features, present work state is almost totally explained by previous state and by idiosyncratic characteristics, which implies a strong persistence. Variables concerning personal characteristics found to be relevant in cross-sectional analyses are not found to be significant in the dynamic setting. Finally, the variables related to the reform have no statistically significant effect on the decision to work off-farm.
    Keywords: off-farm work, farm household, state dependence, panel data, CAP reform, Farm Management, Labor and Human Capital, J220, J430, Q120, Q180,
    Date: 2013–06
  19. By: Coad, Alex; Segarra Blasco, Agustí, 1958-; Teruel, Mercedes
    Abstract: This paper explores the relationship between firm growth, innovation and firm age. We hypothesize that young firms undertake riskier innovation activities and are more oriented towards employment growth than towards harvesting returns in the form of sales growth. Using an extensive sample of Community Innovation Survey for the period 2004-2010, we apply quantile regressions and a Heckman sample selection technique to study the impact of R&D activities on firm growth according to firm age. Our results show that R&D intensity is positively associated with firm growth. However, for young firms R&D shows an increasing influence across the quantiles, while for old firms R&D shows a stable or perhaps decreasing effect over the quantiles. Firm age shows a significant negative impact among young firms, while for the sample of old firms the impact of firm age becomes non-significant. Our Heckman estimations show the evolution of the impact of the R&D on firm growth confirming a significant impact on sales and productivity growth, while the impact is negligible for employment growth. Keywords: firm age, firm growth, innovation, quantile regression. JEL CODES: L25, L20
    Keywords: Empreses -- Creixement, Organització industrial, Innovacions tecnològiques, 33 - Economia,
    Date: 2013
  20. By: Grace Kite (Department of Economics, SOAS, University of London, UK)
    Abstract: Neither the literature on outsourcing nor the literature on the impact of information technology (IT) have previously quantified the effects of IT outsourcing. This is a particularly important omission in India, which has an IT outsourcing industry that is well placed to bring world-class applications of the technology to domestic customers. This paper provides econometric evidence which shows that there is a strong positive impact of IT outsourcing on output and productivity in India. It also demonstrates that in aggregate, IT outsourcing makes a substantial contribution to Indian economic growth.
    Keywords: Information Technology, Outsourcing, India
    JEL: O14 O33 O19
    Date: 2012–06
  21. By: Lööf, Hans (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Johansson, Börje (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: This paper studies the influence of metropolitan externalities on productivity for different types of long run R&D engagement based on information from the Community Innovation Survey. We apply a dynamic general method of moments model to a panel of manufacturing and service firms with different locations in Sweden, classified as a metropolitan region, the largest metropolitan region, a metropolitan city, the largest metropolitan city and a non-metropolitan area. This analysis generates three distinct results. First, the productivity premium associated with persistent R&D is close to 8 percent in non-metro locations and about 14 percent in the largest city. Second, a firm without any R&D engagement does not benefit at all from the external milieu in metro areas. Third, no productivity premium is associated with occasional R&D effort regardless of the firm’s location.
    Keywords: R&D; innovation strategy; productivity; metropolitan; externalities
    JEL: C23 O31 O32
    Date: 2013–06–05
  22. By: Tiberti, M.
    Abstract: This paper investigates production costs of soft wheat by applying the FACEPA cost of production model to the Italian data (RICA) for 2005-2009. Estimates are obtained by carrying out a SUR, allowing for correlated errors between the set of equations and for imposing constraints to coefficients The main aim of this study is to provide a robust analysis of the cost, per hectare and per quintal, of soft wheat in order to analytically support a negotiation bargain on the contractual price for soft wheat within the industrial bread marketing chain. Since RICA, unlike EU FADN, reports some costs related to specific production processes (i.e. related to specific farm outputs), this study reports results of an alternative estimation strategy: the GECOM is carried out by taking into account only those costs that are not ascribed for the specific farm output, but are related to the whole production process. Estimates, per hectare and per quintal, related to such input costs are combined with those costs that are directly observed by farmers, so that we obtain a “hybrid” estimation. This method is carried out in order to confirm results obtained with the “complete” estimation. Outcomes of both methods are reported for Italy and for macro-regions. Costs related to machinery and buildings upkeep represent the most important costs, although a remarkable decline is observed from 2005 onwards. Expenditure in land rent and taxes on land and buildings shows a similar trend, but with smaller values. As a whole, there was a shift expenditure patterns: in 2005-2007 fixed costs prevailed, while in 2008-2009 variable costs became predominant. Anyway, estimates reveal that there are important differences, at geographical level, in production costs.
    Keywords: multi-output, outlier detection, production costs, seemingly unrelated regression, soft wheat, Agricultural and Food Policy, Crop Production/Industries, Demand and Price Analysis, C39, Q12,
    Date: 2013–06
  23. By: Mühlenkamp, Holger
    Abstract: For several decades public enterprises have been criticised for their poor economic performance. Many economists take it as “conventional wisdom” that publicly owned enterprises are inefficient by their very nature. This seemed to be proved by what is probably the most cited survey worldwide, that was written by Megginson and Netter (2001). They claim: “Research now supports the proposition that privately owned firms are more efficient and more profitable than otherwise-comparable state-owned firms” (p. 380). The objective of this paper is to question the proposition that public enterprises are necessarily less efficient as their private counterparts. In doing so, we argue that profits are not a reasonable performance measure for public enterprises. However, our main focus is to present a much more comprehensive review of the empirical evidence than was provided by Megginson and Netter. The evidence indicates that these authors’ conclusions were biased in favour of privatization despite the evidence indicating that the true picture is much more differentiated.
    Keywords: Public enterprises, publicly provided goods, efficiency, privatization, firm performance
    JEL: D24 H42 L25 L32
    Date: 2013–06–07
  24. By: Marconi, V.; Raggi, M.; Viaggi, D.
    Abstract: Agriculture is the main source of nitrogen loading (EEA, 2012) and is the sector with the largest remaining emission reduction potential (Sutton et al., 2011). Furthermore, surpluses of nitrogen are forecast to grow in the next decade (FAO, 2008). The objective of this study is to evaluate the determinants of the use of nitrogen inputs in agriculture, and the effects of RDP implementation in Emilia-Romagna on preventing nitrate pollution through a spatial econometric regression model. Firstly, we carried out an estimation of both inorganic and organic nitrogen input in agriculture at the municipality scale for year 2000 and 2010..Secondly, we performed a Moran’s statistics and a LISA (Local Indicators of Spatial Association; Anselin, 1995) analysis in order test the data for local spatial autocorrelation. Finally, in order to provide a quantitative evaluation of the application of the agri-environmental measures on the impact of farming systems on water quality, we constructed two spatial regression models: INORGANIC AND ORGANIC. Spatial dependence was included to the regressions (OLS) through spatial lag and spatial error. The INORGANIC model explains more than 70% of the dependent variable and suggest that participation to the measure 214 is not likely to be important for explaining the reduction of the Inorganic Nitrogen in the municipalities of Emilia Romagna. Significant variables are farm’s size, population density, location in NVZs and share of certified organic surface on the UAA. The same regressors could not explain the dependent variable in the case of the ORGANIC model. The availability of better estimation of changes in nitrogen inputs, such as the calculation at the farm scale, would be an important component to allow for a more robust use of spatial econometrics in RDP evaluation related to Nitrogen reduction.
    Keywords: agri-environmental scheme, nitrogen, policy analysis, spatial econometric, rural development plans., Agricultural and Food Policy, Environmental Economics and Policy, Farm Management,
    Date: 2013–06
  25. By: Enrica De Cian (Fondazione Eni Enrico Mattei (FEEM) and CMCC); Michael Schymura (Centre for European Economic Research (ZEW)); Elena Verdolini (Fondazione Eni Enrico Mattei (FEEM) and CMCC); Sebastian Voigt (Centre for European Economic Research (ZEW))
    Abstract: This study analyzes energy intensity trends and drivers in 40 major economies using the WIOD database, a novel harmonized and consistent dataset of input-output table time series accompanied by environmental satellite data. We use logarithmic mean Divisia index decomposition to (1) study trends in global energy intensity between 1995 and 2007, (2) attribute efficiency changes to either changes in technology or changes in the structure of the economy, and (3) highlight sectoral and regional differences. We first show that heterogeneity within each sector across countries is high. These general trends within the sectors are dominated by large economies, first and foremost the United States. In most cases, heterogeneity is lower within each country across the different sectors. Regarding changes of energy intensity at the country level, improvements between 1995 and 2007 are largely attributable to technological change while structural change is less important in most countries. Notable exceptions are Japan, the United States, Australia, Taiwan, Mexico and Brazil where a change in the industry mix was the main driver behind the observed energy intensity reduction.
    Keywords: Energy Intensity, Logarithmic Mean Divisia Index Decomposition, WIOD Database
    JEL: Q43 C43
    Date: 2013–04
  26. By: Swamy, Vighneswara
    Abstract: Determinants of default risk of banks in emerging economies have so far received inadequate attention in the literature. Using panel data techniques, this paper seeks to study the determinants bank asset quality and profitability using robust data sets for the period from 1997-2009. The findings of the study reveal some interesting inferences contrary to the established perceptions. Priority sector credit has been found to be not significant in affecting the NPAs contrary to the general perception and similar is the case with that of rural branches implying that aversion to rural credit is a falsely founded perception. Bad Debts are dependent more on the performance of the industry than other sectors of the economy. Public sector banks have shown significant performance in containing bad debts private banks have continued to be stable in containing the bad debts as they have better risk management procedures and technology, which definitely allows them to finish up with lower levels of NPAs. Further, investigating the effect of determinants on profitability it is established that while capital adequacy and investment activity significantly affect the profitability of commercial banks apart from other accepted determinants of profitability, asset size has no significant impact on profitability.
    Keywords: Banks, Risk management, Ownership structure, Financial markets, Non-Performing Assets, Lending Policy, Macro-economy, Central Banks, Banking regulation, Financial system stability
    JEL: E44 E58 G21 G28 G32
    Date: 2013–01
  27. By: Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter
    Abstract: This MEDPRO Technical Report explores the relationship between financial sector development and economic growth, using a sample of northern and southern Mediterranean countries for the years 1985-2009. The authors included several variables to measure the development of the financial sector to account both for quantity and quality effects. The results indicate that credit to the private sector and bank deposits are negatively associated with growth, which confirms deficiencies in credit allocation in the region and suggests weak financial regulation and supervision. On the stock market side, the results seem to indicate that stock market size and liquidity play a significant role in growth, especially when accounting for the quality of an institution. Investment, whether domestic or in the form of FDI, contributes significantly to economic growth. Stronger institutions and low inflation are key growth factors. Initial GDP has a persistently and significantly negative impact on growth, which implies that poorer countries are catching up richer countries in terms of economic growth.
    Date: 2013–03

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.