nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2016‒02‒12
sixteen papers chosen by

  1. Impact of R&D Activities of Firms on Productivity: Findings from an Econometric Study of the Turkish Manufacturing Sector By Elif Dayar; Mehmet Teoman Pamukçu
  2. Unraveling firms: Demand, productivity and markups heterogeneity By Emanuele Forlani; Ralf Martin; Giordano Mion; Mirabelle Muûls
  3. Do Prizes in Economics Affect Productivity? A Mix of Motivation and Disappointment By Jean-Charles Bricongne
  4. Productivity of the English NHS: 2013/14 update By Chris Bojke; Adriana Castelli; Katja GraÅ¡iÄ; Daniel Howdon; Andrew Street
  5. Working Paper 231 - Gender productivity differentials among smallholder farmers in Africa: A cross-country comparison By Adeleke Oluwole Salami; Mukasa Adamon N.
  6. Working Hard in the Wrong Place: A Mismatch-Based Explanation to the UK Productivity Puzzle By Patterson, Christina; Sahin, Aysegul; Topa, Giorgio; Violante, Giovanni L.
  7. The impacts of the EU ETS on Norwegian plants' environmental and economic performance By Marit E. Klemetsen; Knut Einar Rosendahl; Anja Lund Jakobsen
  8. Relative Prices and Sectoral Productivity By Margarida Duarte; Diego Restuccia
  9. Sustainable development and industrial development: Manufacturing environmental performance, technology and consumption/production perspectives By Mazzanti, M.; Nicolli, F.; Marin, G.; Gilli, M.
  10. Educational inequalities in Latin America, PISA 2012: causes of differences in school performance between public and private schools By Geovanny Castro Aristizabal; Gregorio Gimenez Esteban; Domingo Perez Ximenez-de-Embun
  11. Optimal Openness Level and Economic Performance of Firms: Evidence from Belgian CIS Data By Michele Cincera; Pierre De Clercq; Thomas Gillet
  14. The innovation-trade nexus: Italy in historical perspective (1861-1939) By Domini, Giacomo
  15. Dimensions of the welfare state and economic performance: a comparative analysis By João A. S. Andrade; Adelaide P. S. Duarte; Marta C. N. Simões
  16. Technology, Demand, And The Size Distribution Of Firms. By Peter Neary; Monika Mrázová; Mathieu Parenti

  1. By: Elif Dayar (Department of Economics, Atilim University); Mehmet Teoman Pamukçu (TEKPOL, Science and Technology Policy Studies, Middle East Technical University)
    Abstract: In this paper we are investigating the following question for Turkey: “How does the increase in R&D capital stock and how do foreign knowledge spillovers affect labor productivity?” Our sample is composed of R&D performers only, hence the Heckman two stage procedure with the instrumental variables technique for panel data is implemented (Semykina and Wooldridge, 2010). Appropriate instruments are used in regressions for the endogenous variables. Our findings signal that the indigenous efforts of R&D performers and their physical capital stock intensity exert a positive effect on firm-level labor productivity. However, neither foreign ownership nor foreign knowledge spillovers are found to affect R&D performers’ labor productivity positively. On the other hand, skill exerts a strong positive impact on productivity, pointing to the significant role of educated staff in R&D performing firms. We can conclude that Turkish R&D performers are dependent on their accumulated physical capital stock intensity and their own R&D efforts when it comes to increasing labor productivity.
    Keywords: R&D
    Date: 2014–12
  2. By: Emanuele Forlani; Ralf Martin (Imperial College Business School, Imperial College, London, UK,also affiliated with the Centre for Economic Performance (CEP) – London School of Economics and Political Science and the Grantham Institute.); Giordano Mion (Department of Economics, University of Sussex, Falmer, UK, also affiliated with the CEP, CEPR and CESifo.); Mirabelle Muûls (Imperial College Business School and Grantham Institute, Imperial College, London, UK, also affliated with the CEP.)
    Abstract: We develop a new econometric framework that simultaneously allows recovering heterogeneity in demand, TFP and markups across firms while leaving the correlation among the three unrestricted. We do this by systematically exploiting assumptions that are implicit in previous firm-level productivity estimation approaches. We use Belgian firms production data to quantify TFP, demand and markups and show how they are correlated among them, across time and with measures obtained from other approaches. We also show to what extent our three dimensions of heterogeneity allow us to gain deeper and sharper insights on two key firm-level outcomes: export status and size.
    Keywords: Demand, Productivity, Markups, Production function estimation, Export status, Firm size
    JEL: D24 L11 L25 F14
    Date: 2016–02
  3. By: Jean-Charles Bricongne (Banque de France, LEO - Laboratoire d'économie d'Orleans - UO - Université d'Orléans - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Economists’ productivity may evolve after an important award such as the John Bates Clark Medal or the “Nobel Prize”. Yet, when establishing this stylized fact through a diff-in-diff methodology by comparing the treatment group performance of award winners with the one of the control group made of other contenders, one should take into account the fact that these may also alter their productivity due to disappointment. To challenge this hypothesis, using the John Bates Clark Medal as the event likely to impact economists’ productivity, two different methods are used. The first one uses a standard diff-in-diff approach, with a treatment group made of American economists of high enough standard, using as a criterion the belonging to the American Econometrics Association, and a control group made of non-American economists of comparable standard, not fulfilling the criteria (being American, or at least established in the US) to be in a position to hope for this reward. This first approach gives mixed results. The second approach sets an innovative method to build a new treatment and control group. This latest method may be called iterative diff-in-diff: it consists in selecting, into the initial sample for the treatment group, the members of the sample who fit most the expected result, in the case of the present article, the decrease of their productivity. When comparing this sub-sample with the rest of the initial treatment sample, one tries to find a criterion, in line with the initial question raised (in the present case, the fact of attributing a high value to honors, proxied by the position of the honors section in their CV), which differentiates the two sub-samples. With this second method of iterative diff-in-diff, we find that economist who pay most attention to awards increase their productivity before the 40 year threshold of the John Bates Clark Medals and use this increased investment to keep a high productivity for a few years after the age of 40, before registering a sizeable decrease.
    Keywords: awards, diff-in-diff methodology, iterative diff-in-diff, John Bates Clark Medal, productivity
    Date: 2015
  4. By: Chris Bojke (Centre for Health Economics, University of York, UK.); Adriana Castelli (Centre for Health Economics, University of York, UK.); Katja GraÅ¡iÄ (Centre for Health Economics, University of York, UK.); Daniel Howdon (Centre for Health Economics, University of York, UK.); Andrew Street (Centre for Health Economics and Department of Health Sciences, University of York, UK.)
    Abstract: The issue of NHS productivity currently holds substantial public attention, particularly given the efficiency challenge set out in the Five Year Forward View published by NHS England and other national bodies 2014. In 2015 the Department of Health appointed a Minister (Parliamentary under Secretary of State) with a specific ministerial brief for NHS productivity. This report is the latest in a regular series of NHS productivity measures produced by the Centre for Health Economics. This report updates the time-series of National Health Service (NHS) productivity to account for growth between 2012/13 and 2013/14. NHS output encompasses all activity, as valued by administrative costs, for NHS patients, and is measured by combining data from Reference Costs, Hospital Episode Statistics, Prescription Cost Analysis, and the GP Patient Survey.
    Date: 2016–01
  5. By: Adeleke Oluwole Salami (African Development Bank); Mukasa Adamon N. (African Development Bank)
    Abstract: This article investigates gender inequality in agricultural productivity, highlights its key determinants, and approximates the potential production, consumption, and poverty gains from reducing or closing the gender productivity gap. The analysis is performed on the basis of representative household survey datasets recently collected in Nigeria, Tanzania, and Uganda. In these countries, agriculture remains the mainstay of the economy and understanding the extent and sources of gender productivity gaps is crucial for building policy interventions and empowering women. Our econometric approach consists initially in estimating a model of agricultural productivity to uncover the impact of gender of the land manager. Then, mean and quantile-based decomposition approaches are applied to each country separately to underscore the sources of gender differences in agriculture. Using the estimated productivity differentials, we finally measure the potential benefits that each country could obtain from closing or gradually reducing these gaps.The results reveal that female-managed plots have clear endowment disadvantages in farm size, use and intensity of non-labor inputs. The findings show that on average female-managed agricultural lands are 18.6, 27.4, and 30.6% less productive than their male counterparts in Nigeria, Tanzania, and Uganda, respectively. The decomposition of the sources of gender productivity differences indicates that in the three countries, endowment and structural disadvantages of female managers in land size, land quality, labor inputs, and household characteristics are the main drivers of gender gaps. Finally, closing gender productivity differentials is estimated to yield production gains of 2.8% in Nigeria, 8.1% in Tanzania, and 10.3% in Uganda; to raise monthly consumption by 2.9%, 1.4%, and 10.7% in Nigeria, Tanzania, and Uganda; and to help around 1.2%, 4.9%, and 13% households with female-managed lands climb out of poverty in Nigeria, Tanzania, and Uganda, respectively.
    Date: 2016–01–29
  6. By: Patterson, Christina; Sahin, Aysegul; Topa, Giorgio; Violante, Giovanni L.
    Abstract: The UK experienced an unusually prolonged stagnation in labor productivity in the aftermath of the Great Recession. This paper analyzes the role of sectoral labor misallocation in accounting for this “productivity puzzle.” If jobseekers disproportionately search for jobs in sectors where productivity is relatively low, hires are concentrated in the wrong sectors, and the post-recession recovery in aggregate productivity can be slow. Our calculations suggest that, quantified at the level of three-digit occupations, this mechanism can explain up to two thirds of the deviations from trend-growth in UK labor productivity since 2007.
    Keywords: Mismatch; Occupation; Productivity
    JEL: E24 J24 J63
    Date: 2016–01
  7. By: Marit E. Klemetsen; Knut Einar Rosendahl; Anja Lund Jakobsen (Statistics Norway)
    Abstract: This paper examines the impacts of the EU Emissions Trading System (ETS) on the environmental and economic performance of Norwegian plants. The EU ETS is regarded as the cornerstone climate policy both in the EU and in Norway, but there has been considerable debate regarding its effects due to low quota prices and substantial allocation of free allowances to the manufacturing industry. Both quota prices and allocation rules have changed significantly between the three phases of the ETS. The rich data allow us to investigate potential effects of the ETS on several important aspects of plant behavior. The results indicate a weak tendency of emissions reductions among Norwegian plants in the second phase of the ETS, but not in the other phases. We find no significant effects on emissions intensity in any of the phases, but positive effects on value added and productivity in the second phase. Positive effects on value added and productivity may be due to the large amounts of free allowances, and that plants may have passed on the additional marginal costs to consumers.
    Keywords: Tradable emissions quotas; emissions intensity; productivity; propensity score matching; difference-in-differences
    JEL: C23 C54 D22 Q54 Q58
    Date: 2016–02
  8. By: Margarida Duarte; Diego Restuccia
    Abstract: The relative price of services rises with development. A standard interpretation of this fact is that productivity differences across countries are larger in manufacturing than in services. The service sector comprises heterogeneous categories. We document the behavior of relative prices and expenditure shares across two broad classifications of services: traditional services, such as health and education, featuring a rising relative price with development, and non-traditional services, such as communication and transportation, featuring a falling relative price. We find a strong reallocation of real expenditures from traditional to non-traditional services with development. Using a standard multi-sector model extended to incorporate an input-output structure, we show that cross-country productivity differences are much larger in non-traditional services (a factor of 106.5-fold between rich and poor countries) than in manufacturing (only 24.5-fold). Moreover, the productivity difference between non-traditional services and manufacturing is reduced by half when abstracting from intermediate inputs. Development requires solving the productivity problem in non-traditional services in poor countries.
    Keywords: Productivity, services, input-output structure, non-traditional services.
    JEL: O1 O4 E0
    Date: 2016–02–05
  9. By: Mazzanti, M. (Department of Economics and Management, University of Ferrara); Nicolli, F. (IRCrES-CNR, Milano); Marin, G. (IRCrES-CNR, Milano); Gilli, M. (Department of Economics and Management, University of Ferrara)
    Abstract: The aim of this paper is to analyse the environmental performances of manufacturing sectors and their main drivers, (economic factors, technology, trade). We analyse the dynamic development of environmental performances, in absolute terms and in 'productivity' terms, through both decomposition and econometric analyses. The analysis aims to highlight differences over time, across geographical areas, by country income categories and by sector technological classes. Strong emphasis is assigned to the comparison of consumption and production perspectives.
    Keywords: Environmental Performance, Sustainability, Consumption, Production
    JEL: E21 O11 Q56
    Date: 2015–12–01
  10. By: Geovanny Castro Aristizabal; Gregorio Gimenez Esteban; Domingo Perez Ximenez-de-Embun (Faculty of Economics and Management, Pontificia Universidad Javeriana Cali)
    Abstract: The paper notes and explains the causes of the differences in school performance between public and private schools in Latin America. It uses information from the 8 Latin American countries that participated in PISA 2012. The estimations, two steps with instrumental variables, combined with the technique of the Oaxaca-Blinder’s decomposition, reveal that Uruguay and Brazil had the highest education gap, and Colombia and Mexico the lowest. These differences are explained, mainly, by the observed component of the model. Specifically, the differences in individual characteristics explain the greater proportion of the gaps in performance; followed by family characteristics and resources of the schools. In addition, the decomposition in the no-observed component suggests that students from private schools make better use of the educational resources, both in their homes and in their schools.
    Keywords: academic achievement, public and private education, educational production function, instrumental variables, Oaxaca-Blinder decomposition, PISA, Latin America.
    JEL: C29 I21 I24 I28 I29
    Date: 2016–02
  11. By: Michele Cincera; Pierre De Clercq; Thomas Gillet
    JEL: O31 O32 L23
    Date: 2015
  12. By: Paola Cardamone; Valeria Pupo; Fernanda Ricotta (Dipartimento di Economia, Statistica e Finanza, Università della Calabria)
    Abstract: This study provides empirical evidence on the role of universities’ Technological Transfer (TT) activities in the Italian manufacturing sector, with particular attention to the food industry. By using the UniCredit-Capitalia database (2008) for firms and data from the Ministry of Education, University and Research (MIUR) to obtain the university TT indicator, we estimate a probit model to assess the effect of universities’ TT activities on a firm’s likelihood to innovate. Results show that university TT activities seem to stimulate food industry firms innovation and the impact appears significantly higher than for the manufacturing sector.
    Keywords: Universities, Technology transfer, Food firms, Innovation, Spillovers
    JEL: O30 C25 D22
    Date: 2016–02
  13. By: Assienin Kouakou (LFC-R - Laboratoire des Fluides Complexes et leurs Réservoirs - UPPA - Université de Pau et des Pays de l'Adour - Total - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This research aims to analyze the impact of the operational risk management on the performance of the non-financial enterprises in Côte d’Ivoire. On a sample of 70 non-financial enterprises with a rate of answer 63%, we collected the information on the risk management of these enterprises from a questionnaire and completed these information by data descended of the financial data bank. The financial performance has been measured by ROE and the EBITDA. The analyses led on the introverted data drive to the following results: the risks culture and the endowments to the amortizations and stores have a positive impact on the ROE and the EBITDA, while the reserves and the protection contractual influence negatively the ROE and the EBITDA.
    Abstract: Cette étude vise à analyser l’impact de la gestion des risques opérationnels sur la performance des entreprises non financière en Côte d’Ivoire. Sur un échantillon de 70 entreprises non financières avec un taux de réponse de 63%, nous avons collecté les informations sur la gestion des risques de ces entreprises à partir d’un questionnaire et complété ces informations par des données issues de la banque des données financières. La performance financière a été mesurée par ROE et l’EBE. Les analyses menées sur les données recueillies conduisent aux résultats suivants : la culture risque et les dotations aux amortissements et provisions ont un impact positif sur le ROE et l’EBE, tandis que les réserves et la protection contractuelle impactent négativement le ROE et l’EBE.
    Keywords: Risk - Management of the risks - operational risk Management – Performance,Risque - Gestion des risques – Gestion des risques opérationnels-Performance
    Date: 2016–01–07
  14. By: Domini, Giacomo (UNU-MERIT, and Department of Economics and Statistics, University of Siena)
    Abstract: This work investigates the relationship between trade and technological specialisation in Italy, during the long time span ranging from Unification to the eve of the Second World War. To do this, new series of Italy's indices of specialisation in trade and technology are calculated on the base of offcial data. Empirical analysis, based on Spearman rank correlation coefficients and fixed-effects regression, shows the emergence of a positive relationship between specialisation in technology and specialisation in trade after the start of the country's modern economic growth, around the turn of the twentieth century. This, however, was uniquely driven by a negative relationship between technological specialisation and import shares, while no significant relationship between the former and export shares emerges. Furthermore, this finding excludes the most important sector, leading Italian industrialisation, i.e. textiles, the outstanding performance of which can be seen as largely determined by its being particularly suited to the country's factor endowment.
    Keywords: innovation, industrial specialization, trade, import-export, economic history, Italy, specialisation, comparative advantage
    JEL: N73 N74 O14 O33
    Date: 2015–12–10
  15. By: João A. S. Andrade (Faculty of Economics and GEMF, University of Coimbra, Portugal); Adelaide P. S. Duarte (Faculty of Economics and GEMF, University of Coimbra, Portugal); Marta C. N. Simões (Faculty of Economics and GEMF, University of Coimbra, Portugal)
    Abstract: In recent years the desirability of an extensive Welfare State has been increasingly questioned on the grounds that economies with less social intervention by the Government are more competitive and productive. But even if countries do not increase public expenditure, changing the composition of the Welfare State might foster growth by rescaling their intervention in domains that are productivity enhancing. Education and health are the most striking examples given their role as sources of human capital, a fundamental ingredient in many growth models. It is thus important to empirically assess the impact of public expenditures on education and health on educational attainment and health status indicators, and real income. We do this for three groups of countries: a group of high income OECD economies, the EU before the enlargement and the EU enlargement group. We identitfy long-run relationships across the main variables using the DOLS estimator corrected for cross-sectional dependence and we estimate short-run relationships that include an ECM term from the associated long-run equation by applying Fixed-Effects and Pooled Mean Group estimators for the period 1960-2012. The results of the estimation of the long-run equilibrium relationships point to a positive, direct or indirect, influence of (public) education expenditures and (public, private or total) health expenditures on output for the three groups of countries. Causality relationships exhibit mixed results concerning policy variables, within and between country groups, with the results for the high-income OECD (non EU) group supporting the use of social policy variables to foster economic growth.
    Keywords: education, health, public expenditures, economic growth, OECD
    Date: 2016–02
  16. By: Peter Neary; Monika Mrázová; Mathieu Parenti
    Abstract: Abstract We derive exact conditions relating the distributions of firm productivity, sales, output, and markups to the form of demand; in particular, for a large family (including Pareto, log-normal, and Fréchet), the distributions of productivity and output are the same if and only if demand is "CREMR" (Constant Revenue Elasticity of Marginal Revenue). Moreover, we use the Kullback-Leibler Divergence to quantify the information loss when a predicted distribution fails to match the actual one; and we find that,to explain the sales distribution, the choice between Pareto and log-normal productivity distributions matters less than the choice between CREMR and other demands.
    Keywords: CREMR Demands, Heterogeneous Firms, Kullback-Leibler Divergence, Log-Normal Distribution, Pareto Distribution.
    JEL: F15 F23 F12
    Date: 2015–12–21

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