nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2017‒01‒29
nineteen papers chosen by

  1. Is Trade or Trade Risk Good or Bad to Efficiency and Productivity? By Shaik, Saleem
  2. Total factor productivity in South African manufacturing firms By C. Friedrich Kreuser; Carol Newman2
  3. Investigating the effect of efficiency and technical changes on productivity By Halkos, George; Bampatsou, Christina
  4. Is the People’s Republic of China’s Current Slowdown a Cyclical Downturn or a Long-term Trend? A Productivity-Based Analysis By Bai, Chong–En; Zhang, Qiong
  5. Does Vertical Integration Increase Efficiency? A Look at Ethanol Plants in the Center-South of Brazil By Sant'Anna, Ana Claudia; Bergtold, Jason; Featherstone, Allen; Caldas, Marcellus; Granco, Gabriel
  6. EFFICIENCY GAINS DUE TO ECONOMIES OF SCOPE AND SCALE By Shaik, Saleem; Addey, Kwame; Yeboah, Osei
  7. Misallocation, Selection and Productivity: A Quantitative Analysis with Panel Data from China By Tasso Adamopoulos; Loren Brandt; Jessica Leight; Diego Restuccia
  8. Research and Teaching Efficiencies of Turkish Universities with Heterogeneity Considerations: Application of Multi-Activity DEA and DEA by Sequential Exclusion of Alternatives Methods By Y. \c{C}inar
  9. Productivity and Efficiency Effect of Policy Reforms in Kazakhstan By Tleubayev, Alisher
  10. Working Paper 235 - Social Networks, Agricultural Innovations, and Farm Productivity in Ethiopia By AfDB AfDB
  11. Working Paper 237 - Decomposing Sources of Productivity Change in Small-Scale Farming in Ethiopia By AfDB AfDB
  12. Technical Efficiency of Using Water and Soil Resources in Samarkand By Muratov, Shukrullo; Hasanov, Shavkat; Mamasoliev, Sodikjon
  13. Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation By Casey, Gregory
  14. Design, innovation and firm performance in European firms By Sandro Montresor; Antonio Vezzani
  15. The Slowdown in US Productivity Growth: Breaks and Beliefs By Rachael McCririck; Daniel Rees
  16. Profitability or Industrial Relations : What Explains Manufacturing Performance Across Indian States? By Anirban Karak; Deepankar Basu
  17. Regulatory harmonization, profits, and productivity: Firm-level evidence from Morocco By Augier, Patricia; Cadot, Olivier; Dovis, Marion
  18. Factors Affecting Inefficiency Level: Stochastic Frontier Analysis of Public Utility Firms in Japan By Fumitoshi Mizutani; Eri Nakamura
  19. Size and Sector Effects in the Performance of Agricultural Cooperatives: The Case of Georgia By Kakulia, Nino; Kochlamazashvili, Irakli; Mamardashvili, Mamardashvili

  1. By: Shaik, Saleem
    Abstract: The impacts of trade and trade risk on efficiency and productivity of Asia and Sub-Saharan Africa agriculture sector is examined using an extended stochastic frontier analysis econometric model. The extended models links the random and one-sided error term of stochastic frontier analysis to technical efficiency and productivity, respectively. The model estimates primal production function equation, efficiency function equation and productivity function equation, simultaneously. A panel of 17 Asian countries and 32 Sub-Saharan African countries from 1970 to 2010 shows differential impact of trade openness, short-term and long-term trade openness risk on efficiency and productivity.
    Keywords: Trade and Trade risk, Stochastic frontier analysis, Efficiency and Productivity, Asian and Sub-Saharan African, 1970-2010, International Relations/Trade, Production Economics, Productivity Analysis, Research Methods/ Statistical Methods, Risk and Uncertainty, C4, O3, O5, Q1,
    Date: 2017–01–18
  2. By: C. Friedrich Kreuser; Carol Newman2
    Abstract: Abstract: The manufacturing sector is an important source of productivity growth and exports. Manufacturing firms are generally more productive than firms in the agricultural or services sectors and are an important source of job creation. Little is known about the productivity performance of the sector and its drivers in South Africa. The recent availability of firm-level tax administration data has made it possible to measure and analyse the productivity of manufacturing firms in South Africa for the first time. In this paper, we use firm-level data for the period 2010.13 to estimate total factor productivity in the South African manufacturing sector. We examine differences in the level and growth of productivity across manufacturing sub-sectors and examine the heterogeneity in productivity levels within sectors. Our analysis paves the way for future research into the factors driving productivity growth of manufacturing firms that will contribute to the evidence base of the reasons for the significant heterogeneity in measured firm performance, even within narrowly defined sectors and size groups
    Keywords: total factor productivity, South Africa, heterogeneity, tax administration data Handle: RePEc:unu:wpaper:wp2016-wp2016-041.pdf
    Date: 2016
  3. By: Halkos, George; Bampatsou, Christina
    Abstract: Better management of natural capital, an efficient allocation of resources and technological progress can contribute to productivity change. The present study uses Data Envelopment Analysis to determine the Total Factor Productivity Index, in the case of the EU15 countries, using panel data on energy consumption for a period spanning from 1995 to 2011. The aim is not only to determine the index of total factor productivity change but also to record its driving forces for the decision making units under consideration, showing whether the productivity gains come mainly from an improvement in efficiency or derive merely as a result of technological progress. In terms of eco-efficiency, the paper contributes in showing whether the overall development is more driven by input-saving or environmental-saving processes. The detailed decomposition offers policy makers additional insights into more valuable reference material representing the driving forces of productivity gains or losses.
    Keywords: Energy; Energy Consumption; Environmental Economics; Carbon emissions; Eco-Efficiency; Data envelopment analysis; Total factor productivity index.
    JEL: O11 O57 Q01 Q40 Q43 Q48 Q50 Q58
    Date: 2016–12
  4. By: Bai, Chong–En (Asian Development Bank Institute); Zhang, Qiong (Asian Development Bank Institute)
    Abstract: Whether the People’s Republic of China’s (PRC) economic slowdown since the 2008 financial crisis is a cyclical downturn or a long-run trend has important policy implications. Based on provincial panel data, we identify the determinants of productivity and uses counter-factual analysis to decompose the causes of the PRC’s post-crisis slowdown. We find that economic openness has a significantly positive impact on the technical efficiency of production, whereas the income level has a significantly negative effect. Second, a significantly negative correlation is observed between the stock of inventory and productivity, while the opposite is observed between employment involvement rate and productivity. Third, government size and investment rates both have significantly negative effects on productivity. Lastly, the diminishing late-mover advantage and the growth in investment rate are both major contributors to the current decline in the PRC’s productivity. Although the stimulus-induced investment surge has effectively offset the negative effects of the crisis on the PRC’s growth, it is not conducive to the growth of productivity and consumption. The current economic slowdown does not seem to be a cyclical downturn. Indeed, further reforms are needed to stabilize the PRC’s growth.
    Keywords: productivity; technical efficiency; utilization efficiency; allocative efficiency; counter-factual analysis
    JEL: E20 O47
    Date: 2017–01–19
  5. By: Sant'Anna, Ana Claudia; Bergtold, Jason; Featherstone, Allen; Caldas, Marcellus; Granco, Gabriel
    Abstract: Brazil is one of the world’s leading ethanol, sugar and sugarcane producer. Sugarcane is produced by farmers (40%) and ethanol plants (60%). Sugarcane production is limited to a certain radius of the mill to minimize transportation costs and avoid sugarcane quality losses. The distance and harvest timeline limitations aligned with the desire to guarantee sugarcane supply or to create barrier of entry to competing firms make vertical integration, a common practice for mills in Brazil. This study estimates the impact of upstream vertical integration on output-oriented technical efficiency using an output-oriented DEA analysis and a tobit censured model. Inputs considered in the model are the amount of crushed sugarcane and the land used, while the quantities of ethanol and sugar produced are the outputs. The sample consists of 154 mills located in the Center-South area of Brazil. The tobit censured model controlled for the percentage of crushed sugarcane produced on lands owned or rented by mills, the type of mill (i.e. mixed mill or one that produces only sugar or only ethanol), if the mill was in the of Sao Paulo, if it was in the Center-West region and its daily sugarcane crushing capacity. An increase in the percentage of the vertical integration decreases output-oriented technical efficiency by 0.0001 at a 10% level of statistical significance. The continued existence of vertical integration, aligned with the results from this study, implies that mills are adopting this strategy for reasons other than gains in efficiency. Mills may be willing to forgo marginal gains in efficiency, from procuring sugarcane from independent producers, to avoid transaction costs. The Brazilian government may be able to reduce vertical integration by subsidizing sugarcane producers, applying contract enforcement measures and, providing farmers with adequate infrastructure (e.g. paved roads). These measures could increase the number of sugarcane suppliers and eliminate barriers to entry created by mills.
    Keywords: Sugarcane expansion, two-stage data envelopment analysis, transaction costs, Agribusiness, Industrial Organization, Resource /Energy Economics and Policy,
    Date: 2017
  6. By: Shaik, Saleem; Addey, Kwame; Yeboah, Osei
    Abstract: Using a non-parametric linear programming approach, our contribution is (1) to examine if efficiency gains are realized due to diversification and (2) to demonstrate the diversification efficiency gains realized is a product of economies of scope efficiency gains and scale efficiency gains employing U.S. cropping sector made up of nine major crops for the period, 1975-1996. Results indicate efficiency gains are realized due to diversification for all the two-crop combinations. Further the average diversification efficiency gains are explained by scope efficiency gains and scale efficiency gains, with the t-test at the 5% level of significance indicates the mean diversification efficiency gains, scope efficiency gains and scale efficiency gains (with exceptions) are significantly different from one.
    Keywords: Production Economics, Productivity Analysis, Research Methods/ Statistical Methods, Risk and Uncertainty,
    Date: 2017–01–18
  7. By: Tasso Adamopoulos; Loren Brandt; Jessica Leight; Diego Restuccia
    Abstract: We use household-level panel data from China and a quantitative framework to document the extent and consequences of factor misallocation in agriculture. We find that there are substantial frictions in both the land and capital markets linked to land institutions in rural China that disproportionately constrain the more productive farmers. These frictions reduce aggregate agricultural productivity in China by affecting two key margins: (1) the allocation of resources across farmers (misallocation) and (2) the allocation of workers across sectors, in particular the type of farmers who operate in agriculture (selection). We show that selection can substantially amplify the static misallocation effect of distortionary policies by affecting occupational choices that worsen the distribution of productive units in agriculture.
    JEL: O11 O14 O4
    Date: 2017–01
  8. By: Y. \c{C}inar
    Abstract: The research and teaching efficiencies of 45 Turkish state universities are evaluated by using Multi-Activity Data Envelopment Analysis (MA-DEA) model developed by Beasley (1995). Universities are multi-purpose institutions, therefore they face multiple production functions simultaneously associated with research and teaching activities. MA-DEA allows assigning priorities and allocating shared resources to these activities.
    Date: 2016–11
  9. By: Tleubayev, Alisher
    Abstract: The selected paper presented at the IAMO Samarkand Conference
    Keywords: Agricultural and Food Policy, Productivity Analysis,
    Date: 2016–11–02
  10. By: AfDB AfDB
    Date: 2016–05–13
  11. By: AfDB AfDB
    Date: 2016–06–06
  12. By: Muratov, Shukrullo; Hasanov, Shavkat; Mamasoliev, Sodikjon
    Abstract: The selected paper presented at the IAMO Samarkand Conference
    Keywords: Land Economics/Use, Productivity Analysis,
    Date: 2016–11–03
  13. By: Casey, Gregory
    Abstract: In the United States, rising energy efficiency, rather than the use of less carbon-intensive energy sources, has driven the decline in the carbon intensity of output. Thus, understanding how environmental policy will affect energy efficiency should be a primary concern for climate change mitigation. In this paper, I evaluate the effect of environmental taxes on energy use in the United States. To do so, I construct a putty-clay model of directed technical change that matches several key features of the data on U.S. energy use. The model builds upon the standard Cobb-Douglas approach used in climate change economics in two ways. First, it allows the elasticity of substitution between energy and non-energy inputs to differ in the short and long run. Second, it allows for endogenous and directed technical change. In the absence of climate policy, the new putty-clay model of directed technical change and the standard Cobb-Douglas approach have identical predictions for long-run energy use. The reactions to climate policies, however, differ substantially. In particular, the new putty-clay model of directed technical change suggests that a 6.9-fold energy tax in 2055 is necessary to achieve policy goals consistent with the 2016 Paris Agreement and that such a tax would lead to 6.8% lower consumption when compared to a world without taxes. By contrast, the standard Cobb-Douglas approach suggests that a 4.7-fold tax rate in 2055 is sufficient, which leads to a 2% decrease in consumption. Thus, compared to the standard approach, the new model predicts that greater taxation and more forgone consumption are necessary to achieve environmental policy goals.
    Keywords: Energy, Climate Change, Directed Technical Change, Growth
    JEL: H23 O30 O40 Q40 Q54
    Date: 2017–01–24
  14. By: Sandro Montresor (Kore University of Enna, IT); Antonio Vezzani (JRC)
    Abstract: This paper provides some new theoretical speculations and empirical evidence on the relationship between design, innovation and economic performance at the firm level. We posit that design investments may provide firms with a higher capacity of introducing product/process innovations, but that the ensuing economic performance is rather associated to the role of design within the firm. Moreover, once controlled for the firm’s non-technological innovativeness and other knowledge-production inputs, the role of design does also relate to the introduction of innovative products and/or processes. We provide a systematic empirical test for these arguments on a sample of more than 12,000 European firms from the last EC Innobarometer survey. The econometric estimates are consistent with our expectations. However, while a higher innovativeness is also associated with a non-systematic resort to design, a higher innovation-based performance is coupled with an increasingly more central role of design, providing this is at least non-occasional. Innovations do actually look “design-led” overall, but innovating successfully apparently requires the firm to retain such a driver central to its business model.
    Keywords: Design, Innovation, Firm performance
    JEL: O31 O32 O33
    Date: 2017–01
  15. By: Rachael McCririck (Reserve Bank of Australia); Daniel Rees (Reserve Bank of Australia)
    Abstract: We use a business cycle model to explore the timing and size of breaks in long-run equilibrium total factor productivity growth in the United States. We find that steady-state productivity growth halved over the past 50 years, with the decrease most likely to have occurred in the early 1970s. The decline in productivity growth was hard to detect in real time – the behaviour of households and firms indicates that their beliefs about steady-state productivity growth did not adjust until the early-to-mid 2000s. As well as reducing growth in output, slower productivity growth has lowered the neutral real interest rate in the United States and made it harder for monetary policy to combat recessions. Had productivity growth not slowed, the federal funds rate may not have hit the zero lower bound until late 2010.
    Keywords: business cycles, productivity, monetary policy
    JEL: C51 E30 O47
    Date: 2016–10
  16. By: Anirban Karak (Department of Economics, University of Massachusetts, Amherst); Deepankar Basu (Department of Economics, University of Massachusetts, Amherst)
    Abstract: We use a state-level panel data set for the period 1969-2005 to analyze the relative importance of profitability (rate of profit) and industrial disputes (man-days lost to all industrial disputes per worker) in explaining cross-state variations of manufacturing sector performance in India. Using three different measures of manufacturing performance – net value added, investment and employment – we find that profitability is more significant than industrial disputes in explaining the variation of manufacturing sector performance across Indian states. Classification-JEL: B50, C26, O10
    Keywords: manufacturing performance, profitability, industrial disputes
    Date: 2017–01–24
  17. By: Augier, Patricia; Cadot, Olivier; Dovis, Marion
    Abstract: This paper combines a new database on non-tariff measures (NTMs) with Morocco's firm census to explore the effect of regulatory harmonization with the E.U. on firm-level outcomes. Exploiting cross-sectoral variation in the timing and extent of regulatory harmonization, we find that harmonization waves correlate with rises in labor productivity and with higher markups, allowing self-financing of the adaptation process at the firm level. We identify an induced market-structure change that made the observed rise in markups possible. Namely, harmonization temporarily sheltered the Moroccan market from competition from low-end producers in other developing countries, who took time to adapt. We identified this effect through changes in both trade patterns and firm-level outcomes. Thus, harmonization apparently generated a self-financing adaptation process by affecting both firm-level incentives and market structure.
    Keywords: firms; Harmonization; Morocco; Non-Tariff Measures; productivity; Profit; Trade
    JEL: F13 F15
    Date: 2017–01
  18. By: Fumitoshi Mizutani (Graduate School of Business Administration, Kobe University); Eri Nakamura (Graduate School of Business Administration, Kobe University)
    Abstract: The main purpose of this study is to investigate what types of internal and external factors affect technical inefficiency in public utility firms. We consider governance structure and business diversification strategy as internal factors and governmental intervention and competition as external factors. By using 1106 observations comprised of Japanese public utility firms from 1989 to 2002, we estimate the stochastic frontier production function. The main findings are as follows: (i) The governance factor has an important effect on a firm’s inefficiency. As ownership by foreign shareholders and investment funds increase, the technical inefficiency of a public utility firm decreases. (ii) A business diversification strategy increases inefficiency, though the magnitude of increase is relatively small. (iii) Governmental intervention does not have a clear effect on inefficiency. (iv) The monopoly level shows a quite clear effect on a firm’s inefficiency. Overall, our empirical results suggest that internal factors such as governance structure and ownership by foreign shareholders and investment funds, and external factors such as monopoly level are factors especially important to the reduction of technical inefficiency in public utilities.
    Keywords: Stochastic Frontier Analysis, Governance, Diversification Strategy, Regulation, Competition, Public Utility Firms
    JEL: M11 M21 L14 L51
    Date: 2016–01
  19. By: Kakulia, Nino; Kochlamazashvili, Irakli; Mamardashvili, Mamardashvili
    Abstract: The selected paper presented at the IAMO Samarkand Conference
    Keywords: Agribusiness, Productivity Analysis,
    Date: 2016–11–02

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