nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2017‒04‒02
twenty-six papers chosen by
Angelo Zago
Università degli Studi di Verona

  1. Analysis of technical efficiency of rice production in fogera district of Ethiopia: A stochastic frontier approach By Lema, Tadesse Zenebe; Tessema, Solomon Amare; Abebe, Fentahun Addis
  2. Performace of Czech dairy farms in contex of agricultural policy By Zdenka Kroupova
  3. Inefficiency in Rice Production and Land Use: A panel study of Japanese rice farmers By OGAWA Kazuo
  4. Analysis OF Energy Efficiency Practices of SMEs in Ghana: An application of Product Generational Dematerialisation By Ackah, Ishmael
  5. Agglomeration economies in Vietnam : a firm-level analysis By Gokan, Toshitaka; Kuroiwa, Ikuo; Nakajima, Kentaro
  6. Are mergers among cooperative banks worth a dime? Evidence on post-M&A efficiency in Italy By Paolo Coccorese; Giovanni Ferri; Fabiola Spiniello
  7. Intangible Capital and Measured Productivity By Ellen R. McGrattan
  8. Estimating Regional Matching Efficiency in the Indian Labor Market: State-Level Panel Data for 1999-2013 By Lee , Woong
  9. The Effect of Hiring Top Workers on Productivity: What is the Role of Absorptive Capacity? By Lodefalk, Magnus; Tang, Aili
  10. Firm Dynamics, Misallocation, and Targeted Policies By In Hwan JO; SENGA Tatsuro
  11. Did the Basel Process of Capital Regulation Enhance the Resiliency of European Banks? By Gehrig, Thomas; Iannino, Maria Chiara
  12. Does high-involvement management improve productivity? By Böckerman, Petri; Kangasniemi, Mari; Kauhanen, Antti
  13. What Drives Differences in Management? By Nicholas Bloom; Erik Brynjolfsson; Lucia Foster; Ron Jarmin; Megha Patnaik; Itay Saporta-Eksten; John Van Reenen
  14. Productivity and household welfare impact of technology adoption: Micro-level evidence from rural Ethiopia By Mekonnen, Tigist
  15. Is Competition Among Cooperative Banks a Negative Sum Game? By Paolo Coccorese; Giovanni Ferri
  16. Trade in Intermediate Goods: Implications for Productivity and Welfare in Korea By Kim, Young Gui; Pyo, Hak K.
  17. Productivity and the Allocation of Skills By David C Maré; Trinh Le; Richard Fabling; Nathan Chappell
  18. Credit Misallocation During the European Financial Crisis By Schivardi, Fabiano; Sette, Enrico; Tabellini, Guido
  19. We investigate whether quality of care differs between public and private hospitals in England with data on 3.8 million publicly-funded patients receiving 133 planned (non-emergency) treatments in 393 public and 190 private hospitalsites. Private hospitals treat patients with fewer comorbidities and past hospitalisations. Controlling for observed patient characteristics and treatment type, private hospitals have fewer emergency readmissions. Conversely, after instrumenting the choice of hospital type by the difference in distances from the patient to the nearest public and the nearest private hospital, the effect of ownership is smaller and statistically insignificant. Similar results are obtained with coarsened exact matching. We also find no quality differences between hospitals specialising in planned treatments and other hospitals, nor between for-profit and not-for-profit private hospitals. Our results show the importance of controlling for unobserved patient heterogeneity when comparing quality of public and private hospitals. By Giuseppe Moscelli; Hugh Gravelle; Luigi Siciliani; Nils Gutacker
  20. HOW DOES ECONOMIC SOCIAL AND CULTURAL STATUS AFFECT THE EFFICIENCY OF EDUCATIONAL ATTAINMENTS? A COMPARATIVE ANALYSIS ON PISA RESULTS By Paolo Liberati; Raffaele Lagravinese; Giuliano Resce
  21. Financial Development and Growth: Panel Cointegration Evidence from South-Eastern and Central Europe By Stojkoski, Viktor; Popova, Kristina
  22. Asymmetric effects of shocks on TFP By Marcelo Arbex; Sidney Caetano; Michel Souza
  23. The Effect of Exchange Rate Volatility on Productivity of Korean Manufacturing Plants: Market Average Rate Regime vs Free Floating By Choi, Bo Young; Pyun, Ju Hyun
  24. Racing With or Against the Machine? Evidence from Europe By Terry Gregory; A.M. Salomons; Ulrich Zierahn
  25. Impact of agricultural technology adoption on market participation in the rural social network system By Mekonnen, Tigist
  26. Monitoring the knowledge transfer performance of universities: An international comparison of models and indicators By Matthew Ainurul Rosli; Federica Rossi

  1. By: Lema, Tadesse Zenebe; Tessema, Solomon Amare; Abebe, Fentahun Addis
    Abstract: The possible way to improve production and productivity with a given input mix and available technology is to improve efficiency of resource use. For this purpose examining the technical efficiency of the production process is very crucial. Thus, the aim of this paper is to analyze the technical efficiency of rice production in Fogera District of Ethiopia. To do so, stochastic frontier approach is employed on a data which is collected from 200 sample households in 2015/16 production year. The sampling techniques used to get those 200 sample households is a multistage sampling where in the first stage five Kebeles were purposively selected, in the second stage two Gotes randomly selected from each Kebeles and in the third stage 200 households were selected using simple random sampling technique. Doing so, it was found that except manure all the variables in the Cobb-Douglass stochastic frontier model which includes; land, fertilizer, oxen, seed and labor are found to be positively and significantly related to rice production. The average technical efficiency score predicted from the estimated Cobb-Douglas stochastic frontier production function is found to be 77.2% implying that there is a room for rice yield increment by improving the resource use efficiency of the households. The study also revealed that; provision of extension service, training on rice product improvement, experience on rice farming; agrochemical and education tend to be positively and significantly related to technical efficiency while household size is negatively and significantly related. Thus, strengthening extension service provision and training on rice yield increment, campaigns to disseminate rice farming experiences and increasing the supply of agrochemicals are crucial to improve the technical efficiency of rice production in the study area.
    Keywords: Ethiopia, Fogera District, Technical Efficiency, Cobb-Douglas Production Function, Stochastic Frontier Approach
    JEL: D24
    Date: 2016–12
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:77774&r=eff
  2. By: Zdenka Kroupova
    Abstract: Czech agriculture experienced a couple of important institutional and structural changes in the last two decades. These changes were predetermined by the accession of the Czech Republic to the European Union, an event which significantly influenced the performance, structure and size of Czech agriculture and had various impacts on specific sectors. The development in dairy sector after 2004 can be characterized by a reduction of cows, a growth of a milk yield, capital market imperfections, a high dependency of local farm price on world market price development, an increase of share of milk produced on specialized dairy farms and the strong dependency of farm performance on policy measurement, namely quotas and subsidies. An objective of the research is to evaluate the development of Czech dairy farms profitability and its main determinants. More specifically, the presented research examines the dynamics of productivity and profitability in the context of agricultural policy change. It is also focused on the extension of profitability decomposition modelling by policy measurements. The development of profitability and its determinants will be based on parametric econometric approach introduced in Kumbhakar and Lien (2009) and extended by Sipiläinen, Kumbhakar and Lien (2013). Their approach decomposes profitability into the output growth component, the output price component, the input price change component, the technical change component, the scale component, the mark-up component and the technical efficiency change component. Policy measurements are not included in this approach however subsidies and quotas influence production in several ways, e.g. by their effect on productivity and technical efficiency (Hadley, 2006; Zhu and Oude Lansink, 2010; Latruffe, 2010; Bokusheva, Kumbhakar and Lehmann, 2012). The presented research will link-up mentioned approaches. The research will be based on unbalanced panel data of Czech dairy farms-local entities gained from Albertina Databases from 2004 to 2013.The performance of Czech farms has been analysed in a number of studies. The profitability was evaluated by Chandrapala and Knápková (2013), Lososová and Zdeněk (2014). Machek (2013), Machek and Špička (2013), Čechura (2012), Curtiss and Jelínek (2012), Malá (2011), Blazejczyk-Majka et al. (2011), Svoboda and Novotná (2011) analysed the productivity and technical efficiency. However, only a few sector-specific studies can be found in the Czech Republic (Špička and Smutka, 2014; Čechura, Hockmann, Kroupová and Malý, 2014; Doucha, Foltýn and Humpál, 2012; Perný and Kubíčková, 2011; Foltýn, Kopeček, Zedníčková and Vávra, 2009) and they usually suffer from a lack of data availability. That is, our research fills the gap in sector-specific research of farm performance. From the result of mentioned studies we can suppose that the profitability of dairy farms decreased during the first part of analysed time period (2004-2009). After the year 2009, the profitability is supposed to increase by the positive effect of technical change and also by the investment subsidies. However, this increase is probably still negatively affected by scale component and technical efficiency component. The technical efficiency is probably negatively affected by direct payments.
    Keywords: Czech Republic, Agricultural issues, Impact and scenario analysis
    Date: 2015–07–01
    URL: http://d.repec.org/n?u=RePEc:ekd:008007:8196&r=eff
  3. By: OGAWA Kazuo
    Abstract: In this study, an empirical analysis was conducted on the behavior of Japanese rice producers from the standpoint of efficiency in production by using panel data from the Rice Production Cost Statistics by the Ministry of Agriculture, Forestry and Fisheries. The stochastic frontier production function, which comprises four production factors (land, labor, capital stock, and materials), was estimated and the inefficiency indices of production were calculated. Based on this information, the efficient and inefficient rice producers were identified, and the factor demand behavior and characteristics of the arable land utilization for rice production were compared. It was found that inefficient rice producers do not make any adjustments in employment in the short or long run, even if there is a change in the wages. In addition, it was observed that efficient rice producers who hold a large amount of the farms partitioned into small plots reduced the arable land utilization for rice production and increased productivity. However, it was noted that the certified farmers, who should be aiming at an expansion of the scale of operation and efficiency of agricultural operations, tend to reduce arable land utilization for rice cultivation and switch to other crops; moreover, the more efficient the certified farmers are, the larger are the effects of such activities.
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:eti:dpaper:17020&r=eff
  4. By: Ackah, Ishmael
    Abstract: Reducing the amount of energy used in producing a given output is a cost-effective way of tackling global warming. In addition, energy efficiency promotes energy security and saves cost. This study is structured in three parts. First, the energy efficiency practices of small and medium scale enterprises in rural Ghana are investigated. Second, the study applies the Product Generational Dematerialisation method to examine the energy efficiency consumption of electricity and fossil fuels in Ghana. Finally, the general unrestricted model (GUM) is applied to energy consumption in Ghana. The results reveal that reduction in energy consumption among SMEs can be attributed mostly to blackouts and not efficiency as indicated by 72% of the respondents. Further, all three models confirmed that the consumption of energy has not been efficient. Further, productivity was found to be a major driver of energy efficiency. The study recommends public education and the use of new appliances (‘not second hand’) to save energy.
    Keywords: Energy Efficiency, Energy Consumption, Ghana, Product Generational Dematerialization, SMEs
    JEL: Q2 Q21 Q28 Q4 Q41
    Date: 2017–03–09
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:77484&r=eff
  5. By: Gokan, Toshitaka; Kuroiwa, Ikuo; Nakajima, Kentaro
    Abstract: This paper examines the effects of agglomeration economies on firm†level productivity in Vietnam. By using Vietnamese firm†level data and the cluster detection method proposed by Mori and Smith (2013), we estimate the agglomeration economies for firm†level productivity. Specifically, we consider the different effects of agglomeration economies for localization and urbanization, as well as across types of firms; state†owned, private, and foreign†owned firms. Furthermore, we decompose the agglomeration economies into the three sources of the effect; inter†industry transaction relationships, knowledge spillovers, and labor pooling. We find the following results. First, localization economies actually improve firm†level productivity in Vietnam, with firms in the clustered areas having higher productivities. However, the localization economies do not improve the productivity of the state†owned firms. Second, urbanization economies improve productivity only for foreign†owned firms. State†owned and private firms do not benefit from urbanization economies. From the decomposition of agglomeration economies, we find that agglomeration economies formed through transactions work only for private firms. On the other hand, agglomeration economies formed through knowledge spillovers and labor pooling work for foreign†owned firms.
    Keywords: Local economy, Economic conditions, Economic geography, Productivity, Agglomeration Economies, Economic Geography
    JEL: R12
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:jet:dpaper:dpaper636&r=eff
  6. By: Paolo Coccorese (University of Salerno); Giovanni Ferri (LUMSA University); Fabiola Spiniello (University of Salerno)
    Abstract: In this paper we study the intense wave of mergers among Italian mutual cooperative banks (Banche di Credito Cooperativo, BCCs) and try to assess whether those mergers were efficiency-enhancing. For the purpose, we employ a two-step procedure: we first estimate bank-level cost efficiency scores for a large sample of Italian banks in the period 1993-2013 by means of a stochastic frontier approach, then we try to explain the estimated BCCs’ cost efficiency with a set of merger status dummy variables (never merged, before the first merger, merged once, merged twice, etc.) as well as with a vector of control variables. We find that mergers increase mutual banks’ cost efficiency only after a BCC has merged at least three successive times with other BCCs, hence after reaching a remarkably large size. However, we conjecture that this growth in size could harm especially marginal borrowers (i.e. those who are likely to be served by smaller banks but neglected by bigger ones), with a strong and adverse impact on development and inequality and in contrast with BCCs’ ethics and mission.
    Keywords: Banking; Cooperative banks; Mergers; Efficiency
    JEL: D40 G21 G34
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:lsa:wpaper:wpc18&r=eff
  7. By: Ellen R. McGrattan
    Abstract: Because firms invest heavily in R&D, software, brands, and other intangible assets—at a rate close to that of tangible assets—changes in measured GDP, which does not include all intangible in- vestments, understate the actual changes in total output. If changes in the labor input are more precisely measured, then it is possible to observe little change in measured total factor productivity (TFP) coincidentally with large changes in hours and investment. This mismeasurement leaves business cycle modelers with large and unexplained labor wedges accounting for most of the fluctuations in aggregate data. To address this issue, I incorporate intangible investments into a multi-sector general equilibrium model and parameterize income and cost shares using data from an updated U.S. input and output table, with intangible investments reassigned from intermediate to final uses. I employ maximum likelihood methods and quarterly observations on sectoral gross outputs for the United States over the period 1985–2014 to estimate processes for latent sectoral TFPs—that have common and sector-specific components. Aggregate hours are not used to estimate TFPs, but the model predicts changes in hours that compare well with the actual hours series and account for roughly two-thirds of its standard deviation. I find that sector-specific shocks and industry linkages play an important role in accounting for fluctuations and comovements in aggregate and industry-level U.S. data, and I find that the model’s common component of TFP is not correlated at business cycle frequencies with the standard measures of aggregate TFP used in the macroeconomic literature.
    JEL: D57 E32 O41
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:23233&r=eff
  8. By: Lee , Woong (Korea Institute for International Economic Policy)
    Abstract: We analyze state-level matching efficiency in the Indian labor market using stochastic frontier analysis. The key contribution of this research is the estimation of matching efficiency at the state level because the estimates can be used for a state-level measure of labor market conditions. Next, we explore the relation between estimated matching efficiency and population density (or labor market flexibility). The results show that matching efficiency is heterogeneous across states with considerable variation in accordance with the regional diversity in India. However, we find that there is no relationship between the estimated matching efficiency and the well-known labor market conditions of interest. The correlations are either close to zero or not statistically significant, suggesting that other regional diversity may affect matching efficiency in India.
    Keywords: Matching Function; Matching Efficiency; Indian Labor Market; Stochastic
    Date: 2015–12–30
    URL: http://d.repec.org/n?u=RePEc:ris:kiepwp:2015_003&r=eff
  9. By: Lodefalk, Magnus (Örebro University School of Business); Tang, Aili (Örebro University School of Business)
    Abstract: We examine heterogeneous productivity effects of hiring top workers on small and medium-sized enterprises, using longitudinal employer-employee data. We find the productivity effect to be stronger for firms with higher absorptive capacity in terms of having a well-educated workforce, being in a knowledge-intensive industry or performing R&D. Technological laggards within an industry benefit more strongly from hiring top workers if their workforce is more well-educated.
    Keywords: recruitment; knowledge spillover; firm growth; productivity; SME; absorptive capacity
    JEL: D22 D24 D83 J24 J62
    Date: 2017–03–24
    URL: http://d.repec.org/n?u=RePEc:hhs:oruesi:2017_002&r=eff
  10. By: In Hwan JO; SENGA Tatsuro
    Abstract: Access to external finance is a major obstacle for small and young firms. Thus, providing subsidized credit to small and young firms is a widely used policy option across countries. We study the impact of such targeted policies on aggregate output and productivity and highlight indirect general equilibrium effects. To do so, we build a model of heterogeneous firms with endogenous entry and exit, wherein each firm may be subject to a forward-looking collateral constraint for external borrowing. Subsidized credit alleviates credit constraints facing small and young firms, which helps them achieve an efficient and larger scale of production. This direct effect, however, is either reinforced or offset by indirect general equilibrium effects. Factor prices increase as subsidized firms demand more capital and labor. As a result, higher production costs induce more unproductive incumbents to exit, while replacing them selectively with productive entrants. This cleansing effect reinforces the direct effect by enhancing the aggregate productivity. However, the number of firms in operation decreases in equilibrium, and this, in turn, depresses the aggregate productivity.
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:eti:dpaper:17017&r=eff
  11. By: Gehrig, Thomas; Iannino, Maria Chiara
    Abstract: This paper analyses the evolution of the safety and soundness of the European banking sector during the various stages of the Basel process of capital regulation. In the first part we document the evolution of various measures of systemic risk as the Basel process unfolds. Most strikingly, we find that the exposure to systemic risk as measured by SRISK has been steeply rising for the highest quintile, moderately rising for the second quintile and remaining roughly stationary for the remaining three quintiles of listed European banks. This observation suggests that the Basel process has succeeded in containing systemic risk for the majority of European banks but not for the largest institutions. In the second part we analyse the drivers of systemic risk. We find compelling evidence that the increase in exposure to systemic risk (SRISK) is intimately tied to the implementation of internal models for determining credit risk as well as market risk. Based on this evidence, the sub-prime crisis found especially the largest and more systemic banks ill-prepared and lacking resiliency. This condition has even aggravated during the European sovereign crisis. Banking Union has not (yet) brought about a significant increase in the safety and soundness of the European banking system. Finally, low interest rates affect considerably to the contribution to systemic risk across the whole spectrum of banks.
    Keywords: capital shortfall; internal risk models; quantile regressions; resilience; systemic risk
    JEL: B26 E58 G21 G28 H12 N24
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:11920&r=eff
  12. By: Böckerman, Petri; Kangasniemi, Mari; Kauhanen, Antti
    Abstract: There is a positive correlation between the use of high-involvement management practices and firm productivity. However, this correlation does not mean that adoption of such practices would improve productivity. The positive correlation is mostly due to more productive firms adopting high-involvement management practices.
    Date: 2017–03–27
    URL: http://d.repec.org/n?u=RePEc:rif:briefs:56&r=eff
  13. By: Nicholas Bloom; Erik Brynjolfsson; Lucia Foster; Ron Jarmin; Megha Patnaik; Itay Saporta-Eksten; John Van Reenen
    Abstract: Partnering with the Census we implement a new survey of "structured" management practices in 32,000 US manufacturing plants. We find an enormous dispersion of management practices across plants, with 40% of this variation across plants within the same firm. This management variation accounts for about a fifth of the spread of productivity, a similar fraction as that accounted for by R&D, and twice as much as explained by IT. We find evidence for four "drivers" of management: competition, business environment, learning spillovers and human capital. Collectively, these drivers account for about a third of the dispersion of structured management practices. Any opinions and conclusions expressed herein are those of the authors and do not necessarily represent the views of the U.S. Census Bureau. All results have been reviewed to ensure that no confidential information was disclosed.
    Keywords: management, productivity, competition, learning
    JEL: L2 M2 O32 O33
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:cep:cepdps:dp1470&r=eff
  14. By: Mekonnen, Tigist (UNU-MERIT, and Maastricht University)
    Abstract: This study evaluates the potential impact of improved agricultural technologies on smallholders’ crop productivity and welfare. We use household-level data from Ethiopian Rural Household Survey collected by IFPRI in 1989-2009. The survey covers around 1500 rural households drawn from four regions and 15 rural villages. Endogenous treatment effect model is employed to account for the selection bias on households’ technology adoption decision. The study employs both single and multi-level treatment effect approaches which is unique and represents a departure from previous impact evaluation studies which relied on single treatment effects. Results of the analysis indicate that there is positive and significant effect of improved technology adoption on the rural households’ crop productivity and welfare in Ethiopia. Key factors for crop productivity and household welfare in the rural farm households are educational level, farm size, credit access, labor use, an extension program, expenditure for modern input and asset holding. While large household size negatively affects the welfare of households. For improving productivity, food security and welfare of smallholder farmers, policy priority should be an investment in research and development on major cereal crops adapted to local agroecological condition.
    Keywords: Agricultural intensification, agricultural innovation, innovations, impacts, productivity, welfare, endogenous treatment effect model
    JEL: D24 I31 O13 O33 Q18
    Date: 2017–02–06
    URL: http://d.repec.org/n?u=RePEc:unm:unumer:2017007&r=eff
  15. By: Paolo Coccorese (University of Salerno); Giovanni Ferri (LUMSA University)
    Abstract: Does ‘inner’ competition – rivalry among network members – worsen performance in a network of cooperative banks? Inner competition might, in fact, endanger network-dependent scale economies. We test our hypothesis on Banche di Credito Cooperativo (BCCs), Italy’s network of mutual cooperative banks. We find a worsening of performance both at incumbent and (even more) at aggressor BCCs when they compete among themselves. Instead, the worsening is mild when BCCs compete with non-BCC comparable banks. We conclude that inner competition among cooperative banks is a negative sum game and, thus, limiting it would be desirable to preserve the stability of cooperative banking networks.
    Keywords: Cooperative Banks, Rivalry Among Network Members, Strategic Interactions, Negative Sum Game, Banking Network
    JEL: D47 G21 G34
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:lsa:wpaper:wpc19&r=eff
  16. By: Kim, Young Gui (Korea Institute for International Economic Policy); Pyo, Hak K. (Seoul National University)
    Abstract: There have been voluminous contributions such as Daudin et al. (2011), Johnson and Noguera (2012), Koopmans et al. (2010), and Trefler and Zhu (2010) in measuring value added trade based on input-output tables as generalizations of the vertical specialization measures following Hummels et al. (2001). These studies focused on trade in intermediate goods as a key feature of recent global trade. In the case of Korea, about 50% of total exports and 70% of its total imports are intermediate goods trade. This paper contributes to the discussion about the trade in intermediate goods and productivity by revisiting Basu (1995), Jones (2011), and Lee and Pyo (2007) to examine implications of trade in intermediate goods for macroeconomic business cycles and productivity and welfare at the current stage of Korean development. The major revision of the Basu (1995) model is attempted by decomposing intermediate goods into domestically produced intermediate inputs and imported intermediate inputs to investigate implications of the model in a small open economy. The major finding is that the procyclicality of the intermediate goods usage relative to labor usage and TFP changes in both value added and gross-output regressions are significantly weaker in a small open economy like Korea than the large economy of the United States. We also investigate the effects of misallocation and multiplier effects due to intermediate goods on industrial productivity and efficiency following the model of Jones (2011). Since the effects of misallocation can be intensified through the industrial input-output structure of the economy, we calculate the intermediate goods multiplier by Korea's 29 manufacturing industries. We find technical changes and the degree of inefficiency are related with the magnitude of multipliers, but we leave a fundamental identification problem to future research.
    Keywords: Imported Intermediate Goods; Productivity; Business Cycle; Misallocation
    JEL: E20 F10 O10
    Date: 2016–12–30
    URL: http://d.repec.org/n?u=RePEc:ris:kiepwp:2016_014&r=eff
  17. By: David C Maré (Motu Economic and Public Policy Research); Trinh Le (Motu Economic and Public Policy Research); Richard Fabling (Independent Researcher); Nathan Chappell (Motu Economic and Public Policy Research)
    Abstract: We use linked employer-employee data from 2004–2012, combined with individual qualifications data from 1994–2012, to study how graduates with different skills fare in the labour market in the six years after studying. We find that graduates experience improvements in earnings, and that they systematically move between jobs, industries and locations in a pattern that is consistent with their securing better job matches, particularly for high level STEM graduates. We then estimate joint production function and wage equations to see how the skill composition of a firm’s employees correlates with productivity, and compare this with how the skill composition correlates with its wage bill. Our results suggest that degree graduates make a growing positive contribution to production in the six years after graduation, with associated wage growth. There is variation in relative productivity and wages across groups of graduates that differ by field of study and level of qualification.
    Keywords: Firm productivity, linked employer-employee data, skill matching, STEM
    JEL: D29 J24
    Date: 2017–04
    URL: http://d.repec.org/n?u=RePEc:mtu:wpaper:17_04&r=eff
  18. By: Schivardi, Fabiano; Sette, Enrico; Tabellini, Guido
    Abstract: Do banks with low capital extend excessive credit to weak firms, and does this matter for aggregate efficiency? Using a unique data set that covers almost all bank-firm relationships in Italy in the period 2004-2013, we find that, during the Eurozone financial crisis: (i) Under-capitalized banks were less likely to cut credit to non-viable firms. (ii)\ Credit misallocation increased the failure rate of healthy firms and reduced the failure rate of non viable firms. (iii) Nevertheless, the adverse effects of credit misallocation on the growth rate of healthier firms were negligible, and so were the effects on TFP dispersion. This goes against previous influential findings that, we argue, face serious identification problems. Thus, while banks with low capital can be an important source of aggregate inefficiency in the long run, their contribution to the severity of the great recession via capital misallocation was modest.
    Keywords: Bank capitalization; capital misallocation; zombie lending
    JEL: D23 E24 G21
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:11901&r=eff
  19. By: Giuseppe Moscelli (Economics of Social and Health Care Research Unit, Centre for Health Economics, University of York, York, UK); Hugh Gravelle (Economics of Social and Health Care Research Unit, Centre for Health Economics, University of York, York, UK.); Luigi Siciliani (Department of Economics and Related Studies, University of York, York, UK); Nils Gutacker (Economics of Social and Health Care Research Unit, Centre for Health Economics, University of York, York, UK)
    Keywords: ownership, hospital, quality, choice, distance, endogeneity.
    JEL: C36 H44 I11 L33
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:chy:respap:145cherp&r=eff
  20. By: Paolo Liberati; Raffaele Lagravinese; Giuliano Resce
    Abstract: This paper aims at investigating the effect of Economic Social and Cultural Status (ESCS) on the education performances of students, using the latest available waves of Programme for International Student Assessment (PISA) survey (2009, 2012). The analysis is conducted at student level for all countries included in the PISA sample. The estimates are based on the conditional Data Envelopment Analysis (DEA), applied for the first time in the Slack Based Measure. This method allows a detailed evaluation of the additional effort the students should do when they are operating in an ESCS that has a comparative disadvantage. Evidence is provided of a significant effect of the ESCS on student performances, with a strong heterogeneity among countries. It follows that some problems with the education sector may not be due to the education systems themselves, but to the economic, social and cultural gaps, which determine a persistence of inequality of opportunity.
    Keywords: Data Envelopment Analysis; Efficiency; Education; Inequality of Opportunity.
    JEL: C14 I24 I28
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:rtr:wpaper:0217&r=eff
  21. By: Stojkoski, Viktor; Popova, Kristina
    Abstract: Ever since Schumpeter, macroeconomists have argued that financial development has a large and direct effect on the long run wealth of a nation. In this paper, we empirically investigate this relationship for a panel of 16 South-Eastern and Central European countries over the period 1995-2014 by employing a state-of-the-art panel cointegration technique. We find that financial development has a positive effect on the income per capita. The effect is statistically robust to other estimation methods and is economically large since it is almost twice the size of the gross capital formation. Nevertheless, the panel cointegration tests indicate a possibility of an endogenous relationship between the phenomena.
    Keywords: panel-cointegration, financial development, economic growth
    JEL: C23 C51 E50 O11 O47 O52
    Date: 2016–01–24
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:69029&r=eff
  22. By: Marcelo Arbex (Department of Economics, University of Windsor); Sidney Caetano (Department of Economics, Federal University of Juiz de Fora); Michel Souza (Department of Economics, Federal University of Minas Gerais)
    Abstract: We study the TFP distribution and examine the non-stationarity of productivity series at various quantiles. Using the quantile autoregression unit root test, we find that the US TFP exhibits an asymmetric adjustment dynamics, i.e., positive and negative shocks might have different (permanent or temporary) effects on the TFP. Shocks dissemination depends on the local behavior of the TFP. We find that positive shocks have permanent effects on the TFP, while negative shocks can potentially have only transitory effects.
    Keywords: TFP, Unit root tests, Quantile autoregression
    JEL: C22 E32 O47
    Date: 2017–03
    URL: http://d.repec.org/n?u=RePEc:wis:wpaper:1702&r=eff
  23. By: Choi, Bo Young (Korea Institute for International Economic Policy); Pyun, Ju Hyun (Korea University Business School (KUBS))
    Abstract: This study examines how exchange rate volatility can influence total factor productivity (TFP) in various dimensions. Using Korean manufacturing plant-level data for 1990-2007, we first compare and contrast the effects of exchange rate volatility on TFPs between two different exchange rate regimes ― pegged and free floating. We find that the exchange rate volatility had a negative effect on productivity in both regimes but this negative effect was greater during the period when exchange rate fluctuation was restricted, compared to the period with free floating rate. We also find that the negative effects of the volatility on productivity were heterogeneous over TFP quantiles and exhibited an inverted W-shape curve. In particular, the negative effects were more pronounced for exporting plants that had the lowest or highest TFPs.
    Keywords: Total Factor Productivity; Koraen Plant-level Data; Exchange Rate Voltality; Quantile Regression
    JEL: F12 F14
    Date: 2016–10–10
    URL: http://d.repec.org/n?u=RePEc:ris:kiepwp:2016_008&r=eff
  24. By: Terry Gregory; A.M. Salomons; Ulrich Zierahn
    Abstract: A fast-growing literature shows that technological change is replacing labor in routine tasks, raising concerns that labor is racing against the machine. This paper is the first to estimate the labor demand effects of routine-replacing technological change (RRTC) for Europe as a whole and at the level of 238 European regions. We develop and estimate a task framework of regional labor demand in tradable and non-tradable industries, building on Autor & Dorn (2013a) and Goos, Manning and Salomons (2014), and distinguish the main channels through which technological change affects labor demand. These channels include the direct substitution of capital for labor in task production, but also the compensating effects operating through product demand and local demand spillovers. Our results show that RRTC has on net led to positive labor demand effects across 27 European countries over 1999-2010, indicating that labor is racing with the machine. This is not due to limited scope for human-machine substitution, but rather because sizable substitution effects have been overcompensated by product demand and its associated spillovers. However, the size of the product demand spillover -- and therefore also RRTC's total labor demand effect-- depends critically on where the gains from the increased productivity of technological capital accrue.
    Keywords: Labor Demand, Routine-Replacing Technological Change, Tasks, Local Demand Spillovers
    Date: 2016
    URL: http://d.repec.org/n?u=RePEc:use:tkiwps:1605&r=eff
  25. By: Mekonnen, Tigist (UNU-MERIT, and Maastricht University)
    Abstract: This paper provides empirical evidence regarding the impact of agricultural technologies on smallholders’ output market participation. The analysis is based on Farmer Innovation Fund impact evaluation survey collected by the World Bank in 2010-2012 covering 2,675 households in Ethiopia. Endogenous treatment effect and sample selection models are employed to account for the self-selection bias in technology adoption and market participation. Regressions based on matching techniques are employed for robustness check. The estimation results show that the use of improved agricultural inputs significantly affects farm households marketable surplus production. We found evidence that application of high-yielding varieties increases surplus crop production by 7.39 percent per year, whereas chemical fertilizer use increases surplus by 2.32 percent. When farmers apply the two inputs jointly, marketed surplus increases by 6 percent which establish the complementarity of the two technologies. Marketable surplus crop production and market participation of farmers are determined by access to modern inputs, crop price, farm size, availability of labor, and infrastructure. Access to credit and training fosters technology adoption. Therefore, agriculture and rural development policy need to focus on supporting agricultural technology adoption.
    Keywords: Surplus production, technologies, social network, Ethiopia, agricultural innovation,endogenous treatment effect model
    JEL: D04 O12 O13 O33 Q13
    Date: 2017–02–06
    URL: http://d.repec.org/n?u=RePEc:unm:unumer:2017008&r=eff
  26. By: Matthew Ainurul Rosli (University of Wolverhampton); Federica Rossi (Birkbeck, University of London)
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:img:wpaper:24&r=eff

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