nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2015‒03‒22
25 papers chosen by

  1. Maize Productivity and Input Subsidies in Malawi: A State-Contingent Stochastic Production Frontier Approach By Holden , Stein; O’Donnell, Christopher J.
  2. Efficiency of electricity use and productivity change of electricity in China: A nonparametric approach By Chow, Sheung Chi; Wenjing, Xu; Xiaoyang, Wu
  3. Using Labor Productivity Change Estimates as an Input for X-Factors in Price-Cap Regulation By Martín Rossi
  4. Educational Mismatch and Firm Productivity: Do Skills, Technology and Uncertainty Matter? By Mahy, Benoît; Rycx, Francois; Vermeylen, Guillaume
  5. The Econometrics Approach to the Measurement of Efficiency: A Survey By Martín Rossi
  6. Efficiency of Milk Processing Companies – Parametric and non-Parametric Approaches By Jarzębowski, Sebastian; Bezat-Jarzębowska, Agnieszka
  7. The Spanish Productivity Puzzle in the Great Recession By Hospido, Laura; Moreno-Galbis, Eva
  8. Population Aging and Comparative Advantage By Andrey Stoyanov; Nikolay Zubanov; Yoonseok Lee
  9. Hotelling competition and teaching efficiency of Italian university faculties. A semi-parametric analysis By Angela Stefania Bergantino; Claudia Capozza; Francesco Porcelli
  10. The conservation versus production trade-off: does livestock intensification increase deforestation? Evidence from the Brazilian Amazon By Petterson Molina Vale
  11. Impact of Extensive and Intensive Margins of FDI on Corporate Domestic Performance: Evidence from Japanese automobile parts suppliers By MATSUURA Toshiyuki
  12. Innovation and Productivity in Services: Evidence from Chile By Roberto Alvarez; Andrés Zahler; Claudio Bravo-Ortega
  13. Productivity and Potential Output Before, During, and After the Great Recession By John Fernald
  14. The Impact of Training on Technology Adoption and Productivity of Rice Farming in Tanzania: Is Farmer-to-Farmer Extension Effective? By Nakano, Yuko; Tsusaka, Takuji W.; Aida, Takeshi; Pede, Valerien O.
  15. Knowlegde Spillovers, absorptive capacity and growth: An industry-level Analysis for OECD countries By Ioannis Bournakis; Dimitris Christopoulos; Sushanta Mallick
  16. Evaluating the Long-Term Effect of NIST MEP Services on Establishment Performance By Clifford A. Lipscomb; Jan Youtie; Sanjay Arora; Andy Krause; Philip Shapira
  17. The Moderating Effect of Environmental Turbulence in the Relationship between Entrepreneurial Management and Firm Performance By Pratono, Aluisius Hery; Mahmood, Rosli
  18. Efficiency versus Stereotypes: an Experiment in Domestic Production By Hélène Couprie; Elisabeth Cudeville; Catherine Sofer
  19. Managerial Delegation and Aggregate Productivity By Jan Grobovsek
  20. A DEA-financial technology: prior to portfolio analysis with DEA By Albane Tarnaud
  21. Technological Competencies and Firm Performance: Analyzing the Importance of Internal and External Competencies By Grillitsch, Markus; Nilsson, Magnus
  22. Weather shocks and English wheat yields, 1690-1871 By Brunt, Liam
  23. Specialization across goods and export quality By Alcalá, Francisco
  24. Impact of Climate Change on Yield of Major Food Crops in Tamil Nadu, India By V. Saravanakumar
  25. Trade and Productivity: The Family Connection Redux By Klaus Prettner; Holger Strulik

  1. By: Holden , Stein (School of Economics and Business, Norwegian University of Life Sciences); O’Donnell, Christopher J. (School of Economics, The University of Queensland, Australia)
    Abstract: We make cross-sectional comparisons of productivity in a risky agricultural setting. To make meaningful comparisons, we find it necessary to define a new productivity index that satisfies important axioms from index number theory (e.g., transitivity). The index can be computed without any information on output or input prices. However, it cannot be computed without an estimate of a state-contingent production frontier. We use maximum likelihood methods to estimate a state-contingent stochastic production frontier that explicitly allows for variations in input quality. We find that differences in productivity are mainly due to differences in environment and scale-mix efficiency. In turn, we conjecture that differences in scale-mix efficiency are partly driven by variations in access to input subsidies. The maximum likelihood estimator appears to do a poor job of disentangling the effects of technical inefficiency and statistical noise.
    Keywords: agricultural productivity; risky environment; imperfect factor markets; state-contingent analysis; total factor productivity; input subsidies
    JEL: C40 O13 Q10
    Date: 2015–03–12
  2. By: Chow, Sheung Chi; Wenjing, Xu; Xiaoyang, Wu
    Abstract: This paper tries to investigate efficiency of electricity use of 30 administration regions and productivity change of electricity in China for the period 2003-2008. We use the Data Envelopment Analysis (DEA) method to measure the efficiency of electricity use and productivity change of electricity. From an empirical perspective, we provide a framework to investigate the situation of relative efficiency of electricity use and the growth rate of electricity’s productivity. The results indicate that the efficiency gap between regions is very large and the east areas have a higher level of electricity efficiency than the western areas. Moreover, both the technical and efficiency change in China from 2003 to 2008 is also slow. Based on these results, we propose some reasons behind and also give some suggestions about it.
    Keywords: Productivity analysis, efficiency of electricity use, productivity change of electricity, Malmquist productivity index, DEA
    JEL: Z0
    Date: 2014–12
  3. By: Martín Rossi (Department of Economics, Universidad de San Andres)
    Abstract: In this paper I provide an estimate of labor productivity growth for the electricity distribution sector in Latin America, in the period 1994 to 2001. I report an annual rate of labor productivity change of about 6%. A comparison of the changes in prices and labor productivity reveals that, in most cases, final prices to customers did not fall to reflect the huge labor productivity gains that were achieved during the period under analysis.
    Keywords: stochastic frontiers, productivity, technical change
    JEL: O3
    Date: 2015–02
  4. By: Mahy, Benoît (University of Mons); Rycx, Francois (Free University of Brussels); Vermeylen, Guillaume (University of Mons)
    Abstract: The authors provide first evidence on whether the direct relationship between educational mismatch and firm productivity varies across working environments. Using detailed Belgian linked employer-employee panel data for 1999-2010, they find the existence of a significant, positive (negative) impact of over- (under-)education on firm productivity. Moreover, their results show that the effect of over-education on productivity is stronger among firms: (i) with a higher share of high-skilled jobs, (ii) belonging to high-tech/knowledge-intensive industries, and (iii) evolving in a more uncertain economic environment. Interaction effects between under-education and working environments are less clear-cut. However, economic uncertainty is systematically found to accentuate the detrimental effect of under-education on productivity.
    Keywords: educational mismatch, productivity, linked employer-employee panel data, working environments
    JEL: J21 J24
    Date: 2015–02
  5. By: Martín Rossi (Department of Economics, Universidad de San Andres)
    Abstract: I present a survey on the econometric approach to the measurement of efficiency, focusing on the models used in empirical applications. I describe both models for cross sectional data and models for panel data. Finally, I survey the recent literature on models with time varying technical efficiency.
    Keywords: stochastic frontiers, productivity, technical change
    JEL: O3
    Date: 2015–02
  6. By: Jarzębowski, Sebastian; Bezat-Jarzębowska, Agnieszka
    Abstract: In the paper, the authors considered estimation of efficiency, which measures the ability of a company to obtain the maximum output from given inputs. The comparison of results obtained by using two approaches: parametric (on the example of the SFA method, Stochastic Frontier Analysis) and non-parametric (on the example of the DEA method, Data Envelopment Analysis) has been carried out. Data from the companies of a key food processing sector in Poland, namely the milk processing sector, was used in the paper. This sector was chosen due to the large size of the sample, as well as the strategic importance and significant contribution to the production of the entire agri-food sector. Furthermore, with respect to the milk processing sector there are no comparative analyzes carried out, which justifies the need for their conduction. The analysis covered the period 2006-2011, the sample included from 103 up to 160 enterprises (depending on the analyzed year). Basing on the conducted analysis it was claimed that the integral use of the SFA and the DEA methods– combining advantages of both methods – allows preserving the analogy when comparing the results and formulating reliable conclusions.
    Keywords: efficiency, the SFA method, the DEA method, food processing sector, Agribusiness, Production Economics, Research Methods/ Statistical Methods,
    Date: 2014–10
  7. By: Hospido, Laura (Bank of Spain); Moreno-Galbis, Eva (Université d'Angers)
    Abstract: While Spain had traditionally under-performed its European counterparts in terms of labor productivity, the trend is reversed after 2007. The evolution of aggregate productivity in Spain during the Great Recession largely responds to the adverse conditions in the labor market, but not only. Using a longitudinal sample of Spanish manufacturing and services companies between 1995 and 2012, we show that the recent increase in Spanish aggregate productivity also responds to the evolution of the total factor productivity (TFP) and to composition effects. By combining the information at the firm level on balance sheet items, collective agreements and imports-exports, we are able to establish that commitment to a collective agreement at the firm level and access to external markets are positively related to TFP performance during the whole period. In addition, we estimate that firm TFP was negatively correlated with the share of temporary workers during the expansion period, 1995-2007, whereas the sign of that correlation reversed completely during the crisis, 2008-2012. Finally, we relate this sign reversal with the changing composition of temporary workers in the labor market.
    Keywords: labor productivity, TFP, temporary workers, collective agreements, exporting firms
    JEL: J24 J21 J52
    Date: 2015–02
  8. By: Andrey Stoyanov (York University, Department of Economics, Faculty of Liberal Arts and Professional Studies); Nikolay Zubanov (Goethe University Frankfurt, Faculty of Economics and Business Administration, Grueneburgplatz 1, 60323 Frankfurt am Main, Germany); Yoonseok Lee (Syracuse University, Department of Economics and Center for Policy Research, 426 Eggers Hall, Syracuse, NY 13244, USA)
    Abstract: We show, in a very plausible theoretical setting, that control function estimators (CFEs) of firm production function, such as Olley-Pakes, may be biased. The bias will occur, in particular, when investments respond dfferently to short-and long-lasting changes in productivity. We modify the original CFE approach to allow for this differential response by introducing firm fixed effects to the control function. Applying our modified CFE to the data, we find that it does better than the existing CFEs in terms of controlling for persistent unobserved heterogeneity in productivity. Our findings imply that allowing firm fixed effects in the control function enhances its ability to capture firm productivity, and hence improves statistical quality of productivity estimates.
    Keywords: production function, control function estimator, panel data
    Date: 2015
  9. By: Angela Stefania Bergantino (Università degli Studi di Bari Aldo Moro); Claudia Capozza (Università degli Studi di Bari Aldo Moro); Francesco Porcelli (SOSE – Soluzioni per il Sistema Economico S.p.A.)
    Abstract: In this paper we explore the effect of competition (à la Hotelling) on teaching efficiency of the Italian university system at faculty-level, over the period 2004 to 2008. The analysis is performed in two stages. First, we use Data Envelopment Analysis (DEA) to calculate an index of teaching efficiency. Second, a parametric approach is used to evaluate the determinants of teaching efficiency, focusing on the impact of competition. Our results are in favour of competition: when faculties operate in a more competitive environment, they are induced to carry out teaching activity in a more efficient way.
    Keywords: teaching efficiency, competition, two step DEA analysis
    JEL: A2 L13
  10. By: Petterson Molina Vale
    Abstract: More cattle, less deforestation? Land use intensification in the Amazon is an unexpected phenomenon. Theories of hollow frontier, speculative behaviour and boom-bust all share the prediction that livestock production will remain largely extensive. Yet between 1996 and 2006 productivity of cattle grew by an astounding 57.5% in the average Amazon municipality. Does rising land productivity of cattle increase deforestation? I use secondary data and spatial econometrics to look for evidence of a positive relation between cattle intensification and deforestation (‘rebound effect’). The reduced-form model I employ is based on a spatial econometric specification by Arima et al. (2011) and uses panel data at the municipality-level. I show that mounting productivity in consolidated areas has been associated with lower deforestation both in frontier and consolidated municipalities. This suggests that any process of out-migration spurred by the rising productivity is insufficient to have a positive impact on deforestation.
    Date: 2014–12
  11. By: MATSUURA Toshiyuki
    Abstract: This study investigates the impact of foreign direct investment (FDI) on domestic corporate performance using firm-level data on Japanese automobile parts suppliers. While previous studies used the propensity score matching method and focused mainly on the impact of the extensive margin of FDI, this study uses data on the automobile makers' FDI as an instrumental variable for suppliers' FDI and estimates the impact of both extensive and intensive margins of FDI on domestic corporate performance. Our empirical results reveal that while the impact of intensive margins of FDI has no significant impact on corporate performance, FDI in both developed and developing countries has a positive impact on sales and total factor productivity (TFP) in the case of extensive margins. Furthermore, the impact of the first flow of FDI is more profound than that of subsequent flows.
    Date: 2015–03
  12. By: Roberto Alvarez; Andrés Zahler; Claudio Bravo-Ortega
    Abstract: This paper analyzes empirically the relationship between innovation and productivity in the Chilean services sector. Consistent with recent evidence on developed countries, we find that services firms are as innovative as firms in the manufacturing industry. In the basic model, we also find that both industries have similar determinants of the investment in innovation and the probability of introducing innovations (products or process), such as size and export status. In several extensions we find similar roles for technological and non-technological innovation in labor productivity and for determinants such as skill intensity and financial restrictions. In general, our evidence suggests that that innovation input and output is associated with improvements in productivity in both sectors. As extension of the work of Crespi and Zuñiga (2012) we test whether financial constraints are more relevant for either manufactures or services, finding that these seem to be active just for the services sector. We also test for the role of skills finding that they play a central role on the decision to spend in R&D and labor productivity.
    Date: 2013–10
  13. By: John Fernald (Federal Reserve Bank of San Francisco)
    Abstract: U.S. labor and total-factor productivity growth slowed after the early- to mid-2000s in aggregate, industry, and regional data. The broad-based nature of the slowdown, and its timing, rules out simple stories related to housing and finance before the recession, or to effects of the recession itself, but is consistent with some models of the effects of information technology. A calibrated growth model suggests trend productivity growth is only slightly faster than its 1973-1995 pace. One implication is that about ¾ of the shortfall of actual output from pre-recession estimates of trend reflects a reduction in the level of potential.
    Date: 2014
  14. By: Nakano, Yuko; Tsusaka, Takuji W.; Aida, Takeshi; Pede, Valerien O.
    Abstract: How far can new technologies taught to a small number of selected farmers diffuse to other farmers in a village? In order to answer this question, this paper investigates the impact of JICA training on the adoption of rice cultivation technologies and productivity in an irrigation scheme in Tanzania. By using a unique five-year panel data set and spatial econometric techniques, we found that non-trained farmers learned new technologies from trained farmers through social networks and by observing their plots. As a result, the paddy yield of directly trained farmers increased from 3.1 tons per hectare in 2008 to 4.7 tons per hectare in 2012, while that of non-trained farmers increased from around 2.6 tons per hectare in 2008 to 3.7 tons per hectare in 2012.
    Keywords: technology adoption , agricultural training , social learning, rice , Sub-Saharan Africa
    Date: 2015–03–09
  15. By: Ioannis Bournakis; Dimitris Christopoulos; Sushanta Mallick
    Abstract: Spillovers have usually been undertaken at the country level, the spillover effects can be more definitive only if the analysis is conducted at the industry-level. This paper therefore attempts to identify spillovers by disentangling technological innovations into intra- and inter-national knowledge innovations at industry level in driving per capita output growth. Our main findings are first, that there is evidence for a robust positive relationship between R&D, human capital and output growth across these countries at industry-level. Second, the potential of international spillover gains is greater in countries with higher human capital and in industries whose pattern of production is more R&D oriented, import intensive, and dependent on vertical FDI. Finally, significant heterogeneity is found between high and low-tech industries with high-tech group displaying greater knowledge spillovers, suggesting that low-tech industries need to be more innovative in order to absorb the technological advancements of domestic and international rivals.
    Keywords: Knowledge spillover, Industry-level productivity, R&D
    JEL: F1 O3 O4
    Date: 2015–03
  16. By: Clifford A. Lipscomb; Jan Youtie; Sanjay Arora; Andy Krause; Philip Shapira
    Abstract: This work examines the effects of receipt of business assistance services from the Manufacturing Extension Partnership (MEP) on manufacturing establishment performance. Several measures of performance are considered: (1) change in value-added per employee (a measure of productivity); (2) change in sales per worker; (3) change in employment; and (4) establishment survival. To analyze these relationships, we merged program records from the MEP’s client and project information files with administrative records from the Census of Manufacturers and other Census databases over the periods 1997–2002 and 2002–2007 to compare the outcomes and performance of “served” and “unserved” manufacturing establishments. The approach builds on, updates, and expands upon earlier studies comparing matched MEP client and non-client performance over time periods ending in 1992 and 2002. Our results generally indicate that MEP services had positive and significant impacts on establishment productivity and sales per worker for the 2002–2007 period with some exceptions based on employment size, industry, and type of service provided. MEP services also increased the probability of establishment survival for the 1997–2007 period. Regardless of econometric model specification, MEP clients with 1–19 employees have statistically significant and higher levels of labor productivity growth. We also observed significant productivity differences associated with MEP services by broad sector, with higher impacts over the 2002–2007 time period in the durable goods manufacturing sector. The study further finds that establishments receiving MEP assistance are more likely to survive than those that do not receive MEP assistance. Detailed findings of the study, as well as caveats and limitations, are discussed in the paper.
    Date: 2015–03
  17. By: Pratono, Aluisius Hery; Mahmood, Rosli
    Abstract: Contingency theory points out the adaptive management is crucial point to sustainable firm performance. This research aims to determine the relative importance of a set of variables comprising the four entrepreneurial management variables, i.e. strategic orientation, organization culture, organization structure, and reward system, and a set of environmental turbulence variables in predicting firm performance. This research uses firm-level data with observed population of this research is SMEs in Surabaya, Indonesia. Through adopting hierarchical regression approach and partial least square method, this study indicates that moderating effect of environmental turbulence changes the direction of relationship between entrepreneurial management and firm performance. During low environmental turbulence, entrepreneurial management has positive impact on firm performance, but the direction changes. Entrepreneurial management has negative impact on firm performance during high environmental turbulence.
    Keywords: firm performance, entrepreneurial management, environmental turbulence
    JEL: M0 M00 M1 M12 M14 M2 M5 M52
    Date: 2014
  18. By: Hélène Couprie (Université de Cergy-Pontoise); Elisabeth Cudeville (Centre d'Economie de la Sorbonne - Paris School of Economics); Catherine Sofer (Centre d'Economie de la Sorbonne - Paris School of Economics)
    Abstract: Most household models assume that decisions taken inside the family are Pareto optimal. However, empirical studies cast doubts upon the efficiency assumption. The sharing of time among men and women between market work and household work is highly differentiated by gender. In this paper we examine whether couples deviate from efficiency in household production decisions, using an experimental design in which subjects are real couples. The aim of the experiment is to mimic the sharing of highly-gendered household tasks. We compare the sharing of gendered tasks to that of more neutral tasks. By measuring individual productivity in each task, we can see if couples tend to deviate from efficiency, and by how much in each case. As we show that they deviate more when sharing gendered tasks, we also explore why, looking at different possible explanations, and we find evidence of the impact of stereotypes on inefficiencies
    Keywords: Stereotypes; social norms; household production; time allocation; experiment; production function; household behavior; intra-household decision-making
    JEL: D13 J16 J22 C91 C92
    Date: 2015–03
  19. By: Jan Grobovsek (University of Edinburgh)
    Abstract: This paper proposes a novel mechanism to answer why firms in low income countries are badly managed, and quantifies the resulting productivity loss. First, I present empirical evidence on a significant positive correlation between the share of managerial workers and contract enforcement across countries. Second, I construct a tractable model that captures benefits to managerial delegation in large organizations. The model also features an agency problem between the owner of a firm and its middle management. Ineffective contract enforcement, allowing middle managers to steal from the firm, constrains firm size by limiting the efficient delegation of managerial authority. Third, I use a calibrated version of the model to measure the effect of lowering contract enforcement. Compared to the benchmark of US contract enforcement, no enforcement decreases the aggregate share of managerial workers by about 10 percentage points, typical of countries with income levels of about one-tenth of the US. The associated loss in aggregate labor productivity is roughly 18 percentage points. Auxiliary statistics on the mean firm size, self-employment and productivity dispersion offer additional empirical validation of these results.
    Date: 2014
  20. By: Albane Tarnaud (IESEG School of Management (LEM-CNRS); CNRS-LEM and IESEG School of Management)
    Abstract: In this paper, we question the definition of a financial technology that results from the application of a traditional methodology with DEA to the analysis of portfolios of financial assets. We acknowledge the previous applications and show how two approaches have been adopted until now in the literature: a ‘DEA-production’ approach inherited from production theory and a ‘DEA-benchmarking’ approach inherited from operational research. We show how these approaches define the technology regarding financial assets; we also identify which underlying criteria are used for input and output selection. As a basis for a new ‘DEA-financial’ approach, we propose to identify a ‘financial production process’ that differs from the traditional risk-return relationship but is rather based on the generation of a distribution of returns by an initial investment. This identification of a financial production process ensures the proper selection of input and output variables and addresses several issues recently raised by Cook, Tone & Zhu (2014).
    Keywords: Data envelopment analysis; Input; Output; DEA-financial technology; Portfolio
    Date: 2015–03
  21. By: Grillitsch, Markus; Nilsson, Magnus
    Abstract: In this paper, we analyze the relationship between technological competencies (TC) and firm performance. Theoretically, the importance of TC is well established and widely accepted. Therefore, it is surprising that a number of empirical studies have been unable to confirm a substantial positive relationship between TC and firm performance. We identify two major reasons for this: [i] affected by the availability and choice of indicators existing studies are often biased towards large firms; and [ii] they frequently do not consider both internal and potential access to firm-external TC. This paper discusses conceptually the interplay between firm-internal and firm-external TC as well as the mediating effect of firm size. These relationships are then analyzed empirically using Swedish micro data on 15,682 firms in 290 Swedish municipalities. Novel indicators based on occupational statistics are combined with measures of time-distance accessibility to study internal and external TC. The results provide evidence for a positive relationship between firm growth and TC. In particular, the combination of firm-internal and firm-external competencies seems to be conducive for growth. Lastly, our study suggests that firm size is an important factor to further our understanding about these relationships. Based on this we identify a number of future research questions to be addressed.
    Keywords: technological competencies, firm performance, accessibility, knowledge, innovation, geography, Agribusiness, Institutional and Behavioral Economics,
    Date: 2014–10
  22. By: Brunt, Liam (Dept. of Economics, Norwegian School of Economics and Business Administration)
    Abstract: We estimate a time series model of weather shocks on English wheat yields for the early nineteenth century and use it to predict weather effects on yield levels from 1697 to 1871. This reveals that yields in the 1690s were depressed by unusually poor weather; and those in the late 1850s were inflated by unusually good weather. This has led researchers to overestimate the underlying growth of yields over the period by perhaps 50 per cent. Correcting for this effect would largely reconcile the conflicting primal and dual estimates of productivity growth over the period.
    Keywords: Weather; agriculture; productivity
    JEL: N50 O30 Q10 Q20
    Date: 2015–03–05
  23. By: Alcalá, Francisco (Fundamentos del Análisis Económico)
    Abstract: This paper explores the link between international specialization across goods and within goods along the quality dimension. The analysis is performed in a multi-country model with an integer number of efficiency heterogeneous firms producing each good and under reasonably general assumptions on the shape of firm efficiency distributions and market structure. In equilibrium, each country exports a range of qualities for each good that overlaps with the ranges of other countries following patterns that relate to differences in wages, trade frictions and absolute advantage. If firm efficiency is quality biased (i.e., the relative productivity of more efficient firms is higher when producing higher quality) then, conditional on wages, the average quality of the exports within an industry increases with the country's international specialization in that industry.
    Keywords: comparative advantage, absolute advantage, quality, vertical differentiation
    JEL: D12 R23
    Date: 2014–05
  24. By: V. Saravanakumar
    Abstract: This study uses panel data for 39 years and 13 districts to estimate the yield sensitivity of major food crops to climate change in the South Indian state of Tamil Nadu. We first estimate the marginal impacts of climate variables on crop yield using Panel Corrected Standard Error (PCSE) models. These estimates are then used to identify yield sensitivities in the future based on projected climate variables from theRegional Climate Model version 4 (RegCM4). Empirical results show a quadratic (inverted U shaped) relationship between rice and sorghum yield and climate variables. As temperature and rainfall increase, crop yield initially increases up to a threshold level, and then decreases. Following the RegCM4 projections that observed warming and anomalies in rainfall will continue, this could result in a significant loss in crop productivity. Projections suggest that there may be a 10 percent decline in rice yield and 9 percent decline in sorghum yield by the end of the 21st century relative to average yields during 1971-2009. This indicates a need for new seed varieties that are less sensitive to rainfall and temperature thresholds, and, adaptation practices such as adjustments in sowing time.
    Keywords: Climate change, Agriculture, Productivity changes, Panel corrected standard errors, Regional climate model, India
  25. By: Klaus Prettner; Holger Strulik
    Abstract: We investigate the effects of human capital accumulation on trade and productivity by integrating a micro-founded education and fertility decision of households into a model of international trade with firm heterogeneity. Our theoretical framework leads to two testable implications: i) the export share of a country increases with the education level of its population, ii) the average profitability of firms located in a country also increases with the education level of its population. We find that these implications are supported by empirical evidence for a panel of OECD countries from 1960 to 2010.
    Keywords: firm heterogeneity, international competiveness, education, fertility decline
    JEL: F12 F14 I20 J11
    Date: 2015–03

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.