New Economics Papers
on Efficiency and Productivity
Issue of 2014‒01‒17
ten papers chosen by

  3. DYNAMICS OF LABOUR COSTS OF SERBIAN DAIRY PROCESSING INDUSTRY By Muminović, Saša; Pavlović, Vladan; Milačić, Ljubiša
  4. Wages and Labour Productivity: the role of performance-related pay in Italian firms By Mirella Damiani; Fabrizio Pompei; Andrea Ricci
  5. The Effect of Within-Sector, Upstream and Downstream Energy Taxes on Innovation and Productivity By Chiara Franco; Giovanni Marin
  6. Farm profitability and Labour Use Efficiency By Amarender A, Reddy
  7. Fishing for complementarities: Competitive research funding and research productivity By Hottenrott, Hanna; Lawson, Cornelia
  8. Innovation Complementarity and Environmental Productivity Effects: Reality or Delusion? Evidence from the EU By Marianna Gilli; Susanna Mancinelli; Massimiliano Mazzanti
  9. Energy Efficiency and Industrial Output: The Case of the Iron and Steel Industry By Florens Flues; Dirk Rübbelke; Stefan Vögele
  10. Multifactor productivity estimates for France: what does it change to take capital and labour quality into account? By P.-Y. CABANNES; A. MONTAUT; P.-A. PIONNIER

  1. By: Popovic, Rade
    Abstract: The objective of this research was to examine efficiency of the most common milk production systems in central Serbia. Sample with 8 farms is not statistically representative, but allows use of Data envelopment analysis (DEA). Such technique allows measurement of whole farm efficiency and gives benchmarks for further farm analysis. DEA compare levels of input and outputs for a given dairy farm with all other analysed dairy farms, determining levels of efficiency for all farms with collected consistent data set. A DEA model to measure economic efficiency was developed. It measure efficiency of producing physical (milk) and economic outputs (income) by use of physical (labour and cows) and economic inputs (feed cost). Results revealed that economic efficiency was achieved by three from eight farms. In total, milk production system with grazing period had higher level of efficiency 0,796 comparing with intensive production system with 0,579. But, in intensive milk production system one farm showed efficiency. This indicates that some other input variables like farmer’s management capabilities influenced on efficiency.
    Keywords: Economical efficiency, milk, Serbia, production system, dairy farm, Livestock Production/Industries, Production Economics, Productivity Analysis, Q12,
    Date: 2013–09
  2. By: Vukelić, Nataša; Novković, Nebojša
    Abstract: Measurement of the efficiency of agricultural production is very important issue especially in developing countries. The major problem of the broiler production in Vojvodina region is low level of productivity and inefficiency in resource allocation and utilization. The objective of this study was to measure the economic efficiency of broiler farms using a nonparametric approach, Data Envelopment Analysis (DEA) which is used to quantify economic efficiencies of broiler farms in Vojvodina region by determining which farms are located on the production frontier and which are not. Data Envelopment Analysis method, one of new methods of operations research, is used very successfully in the last several years for assessing relative efficiency of organizational units having multiple inputs to produce multiple outputs. It was originated by Charnes, Cooper and Rhodes in 1978. It is an efficiency estimation technique but it can be used for solving many problems of management such as ranking Decision Making Units (DMU). DEA develops a function whose form is determined by most efficient producers and indentifies a “frontier” on which the relative performance of all utilities in the sample can be compared: DEA benchmarks firms only against the best producers. Furthermore, in order to fulfill the objective of the study, the authors were analyzing the performance of the broiler farms in Vojvodina region, their economic efficiencies. Data were collected from 30 broiler farms from which the input-output data were collected by using a structured questionnaire. The multiple-input, single-output production units (the broiler farms) were evaluated with the individual farms being referred to as individual Decision Making Unit (DMU). For the purpose of efficiency analysis, output (y) were aggregated into one category namely, gross margin of the broiler farms, and inputs were aggregated into five categories, namely, feed, day-old chickens, productivity, used energy and capital. Analyzed broiler farms were classified into three categories according to their production capacities. The first category included farms with production capacity between 5000 birds and 10000 birds per production cycle. The second category included farms with capacity of more than 10000 and less that 30000 birds per production cycle and the third category included farms with capacity of more than 30000 birds per production cycle.
    Keywords: Broiler production, economic efficiency, DEA method, Vojvodina, Agribusiness, Farm Management, Production Economics, C67, Q12,
    Date: 2013–09
  3. By: Muminović, Saša; Pavlović, Vladan; Milačić, Ljubiša
    Abstract: Previous research has shown that the dairy industry in Serbia is more profitable than the market average measured by indices of the Belgrade Stock Exchange BELEX15 and BELEXLINE. The labour costs are, after raw milk costs, the second most important group of costs in dairy processing industry. The aim of this paper is to identify changes and adaptations of modern industry market conditions through analysis of labour cost of dairy processing industry in Serbia, by analysis of the trends in the number of employees, average labour cost, and productivity and cost efficiency and through the prism of these changes. In this paper, on qualified sample is proved that there is a strong positive correlation between firm size and productivity and a weaker one between firm size and labour costs. On the other hand, contrary to previous research, relation between the size of companies in the sample and the economic efficiency of labour costs was not confirmed.
    Keywords: dairy processing industry, labour cost, productivity, cost efficiency, Labor and Human Capital, Livestock Production/Industries, G31, G32, Q14,
    Date: 2013–09
  4. By: Mirella Damiani; Fabrizio Pompei; Andrea Ricci
    Abstract: This paper analyses the role of Performance Related Pay (PRP) agreements on labour productivity and wages. Its main contribution is thus to investigate the effects of PRP on both dimensions, i.e. productivity and distribution, whereas most of the studies of related literature are restricted to one of those aspects. All estimates are performed for a large sample of manufacturing and service Italian firms with more than five employees and a restricted sample including only unionised firms. It allows us to focus on a relevant feature of industrial relations represented by worker representation and its role in local wage setting in the Italian economy. The expected positive link between PRP and firm performance has been confirmed in all estimates, also controlling for a rich set of covariates. Furthermore, the comparison of productivity estimates with those for wages allows us to ascertain that payments by results might be not only rent-sharing devices, but schemes that substantially lead to efficiency enhancements. These findings have been validated by a number of robustness checks, also taking into account endogen eity by using instrumental variables and the treatments of 3SLS. The paper argues that well designed policies, that circumvent the limited implementation of PRP practices, would guarantee productivity improvement. The real effectiveness of these measures would not be weakened under union governance.
    Keywords: Efficiency, Wages, Performance–related pay, unions.
    JEL: D24 J31 J33 J51
    Date: 2013–11–18
  5. By: Chiara Franco (Catholic University); Giovanni Marin (Ceris-CNR, Institute for Economic Research on Firms and Growth, National Research Council of Italy)
    Abstract: The aim of the paper is to investigate the effect of environmental stringency on innovation and productivity using a cross-country panel made up of 7 European countries for 13 manufacturing sectors over the years 2001-2007. This research topic goes under the heading of Porter Hypothesis (PH) of which different versions have been tested. We take into consideration both the strong and the weak versions while adding some peculiarities to the analysis. Firstly, we assess the role played by a specific environmental regulation, that is energy taxes, that have rarely been empirically tested as factors that can favour PH hypothesis to be verified. Secondly, we do not consider, within the same framework, only the effect of energy taxes in the same sector (within-sector), but also the role played by energy taxes in upstream and downstream sectors in terms of input-output relationship. Thirdly, we test these relationships also “indirectly” by verifying whether innovation can be one of the channels through which higher sectoral productivity can be reached. The main findings suggest that downstream stringency is the most relevant driver for innovation and that most of the effect of regulation on productivity is direct, while the part of the effect mediated by induced innovation is not statistically significant.
    Keywords: Energy Taxes, Porter Hypothesis, Upstream, Downstream
    JEL: L6 O13 Q55
    Date: 2013–12
  6. By: Amarender A, Reddy
    Abstract: Appropriate choice of cropping systems to local agro-ecology increases profitability and employment. The increased labour shortage and reduced profitability are growing concerns to the farmers. Keeping this, the paper written with the following objectives: i) To assess the profitability among different cropping systems in the semi-arid tropics; ii) To assess the labour use pattern among different cropping systems and farm size; iii) To determine the resource use efficiency of the different cropping systems in the SAT India; and finally iv) To assess the influence of regional/local factors on incomes of farmers in the SAT India. The study used plot wise data collected from 16 villages from India for the crop year 2010. And it also estimated the resource use efficiency especially labour across different farm size groups in the SAT India and finally to assess the influence of regional/local factors on profitability of farmers. The study shows that input intensive cropping systems like cotton, paddy, wheat, fruits and vegetables based cropping systems are more profitable across many of the SAT villages compared to coarse cereals, pulses and oilseeds based cropping systems. Most of the villages are experiencing the shortage of labour as indicated by higher marginal productivity of labour and increasing trend of mechanisation. Farm size is having positive association with the hired labour use and farm mechanisation, but having negative association with family labour. Female employment has inverted “U” shape relation with farm size. This indicates that the farms with more than five hectares of land are detrimental to women employment as farm mechanization in large farms replaces women labour.
    Keywords: Cropping systems, semi-arid tropics, cost-benefit analysis, production function, labour use efficiency
    JEL: J2 J24 J3 J31 Q1 Q15
    Date: 2013–12–01
  7. By: Hottenrott, Hanna; Lawson, Cornelia
    Abstract: This paper empirically investigates complementarities between different sources of research funding with regard to academic publishing. We find for a sample of UK engineering academics that competitive funding is associated with an increase in ex-post publications but that industry funding decreases the marginal utility of public funding by lowering the publication and citation rate increases associated with public grants. However, when holding all other explanatory variables at their mean, the negative effect of the interaction does not translate into an effective decrease in publication and citation numbers. The paper also shows that the positive effect of public funding is driven by UK research council and charity grants and that EU funding has no significant effect on publication outcomes. --
    Keywords: Research Funding,University-Industry Collaboration,Scientific Productivity
    JEL: L31 O3
    Date: 2013
  8. By: Marianna Gilli (University of Ferrara, Italy); Susanna Mancinelli (University of Ferrara, Italy); Massimiliano Mazzanti (University of Ferrara & Ceris Cnr Milan, Italy)
    Abstract: Innovation is a key element behind the achievement of desired environmental and economic performances. Regarding CO2, mitigation strategies would require cuts in emissions of around 80-90% with respect to 1990. We investigate whether complementarity, namely integration, between the adoption of environmental innovation measures and other technological and organizational innovations is a factor that has supported reduction in CO2 emissions per value added, that is environmental productivity. We merge new EU CIS and WIOD meso level data to assess the innovation effects on sector CO2 performances at a wide EU level. We find that jointly adopting different innovations is not a significant factor to increase environmental productivity, neither for the entire economy nor for manufacturing or narrower ETS sectors. The only case where a complementarity arises is for Northern EU manufacturing sectors that integrate eco innovations with product and process innovations to support environmental productivity. We believe that the lack of integrated innovation adoption behind environmental productivity performance is a signal of the current weaknesses economies face in tackling climate change and green economy challenges. Incremental rather than more radical strategies have predominated so far; this is probably insufficient when we look at long-term economic and environmental goals.
    Keywords: Complementarity, Innovation, Climate Change, Sector Performance
    Date: 2013–10
  9. By: Florens Flues (OECD, France, formerly Zentrum für Europäische Wirtschaftsforschung (ZEW), Germany); Dirk Rübbelke (Basque Centre for Climate Change (BC3), and IKERBASQUE – Basque Foundation for Science, Spain); Stefan Vögele (Institute for Energy and Climate Research - Systems Analysis and Technology Evaluation, Forschungszentrum Jülich (IEK-STE), Germany)
    Abstract: The iron and steel industry is one of the most carbon emitting and energy consuming sectors in Europe. At the same time this sector is of high economic importance for the European Union. Therefore, while public environmental and energy policies target this sector, there is political concern that it suffers too much from these policy measures. Various actors fear a policy-induced decline in steel production, and possibly an international reallocation of production plants. This study analyzes the role that input prices and public policies may play in attaining an environmentally more sustainable steel production and how this - in turn - affect total steel output. As we find out for examples of major European steel producing countries, a kind of rebound effect of energy-efficiency improvements in steel production on total steel output may arise.
    Keywords: Energy Efficiency, Iron And Steel Industry, Environmental Protection, Rebound Effect
    JEL: L51 L61 Q43 Q50
    Date: 2013–11
  10. By: P.-Y. CABANNES (Insee); A. MONTAUT (Insee); P.-A. PIONNIER (Insee)
    Abstract: Potential growth estimates and forecasts generally rely on a decomposition of GDP growth into three production factors: the volume of labour, the volume of capital and a residual term called multifactor productivity (MFP). This residual term is often considered as the contribution to growth of technical progress even if it represents, more generally, all sources of growth not already taken into account by the first two production factors. The amplitude of this residual term may be reduced if the contribution to growth of labour and capital quality is also measured, i.e. by taking into account that different capital and labour types may have different productivities. From 1979 to 2010, on the whole economy excluding agriculture, real estate and non-market services, net capital stock grows at a rate of 2.5% a year and capital quality at 0.4% a year. The contribution of capital quality is higher when firms invest more. Over the same period, aggregate hours of work remain globally stable whereas labour quality grows at 0.5% a year. From 1994 to 2007 on the whole economy, taking quality effects into account reduces the MFP growth rate from 1.3% to 0.9% a year and subtracting business cycle effects further reduces it to 0.7% a year. Starting from this new MFP estimate and making different assumptions on the evolution of quality effects, on capital accumulation and on the evolution of the labour force, we propose three potential growth scenarios over 2015-2025. Most of the uncertainty comes from MFP projections. If one assumes that MFP will recover its pre-2008 growth rate or that it will be reduced by a small or large extent, potential growth can be projected between 1.2% and 1.9% a year.
    Keywords: growth accounting, multifactor productivity, capital services, labour services, potential growth
    JEL: E01 E22 E24 O47
    Date: 2013

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