nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2018‒12‒17
nineteen papers chosen by
Angelo Zago
Università degli Studi di Verona

  1. Productivity, efficiency and technological change in French agriculture during 2002-2014: A F re-Primont index decomposition By Latruffe, L.; Dakpo, K.H.; Desjeux, Y.; Jeanneaux, P.
  2. Returns to Managerial Ability and Technical Efficiency in Argentina Dairy Farms By Gallacher, M.; Lema, D.
  3. Tax Incentives and Agricultural Productivity Growth in Ukraine By Nivievskyi, O.
  4. Measuring Technological Innovation over the Long Run By Bryan Kelly; Dimitris Papanikolaou; Amit Seru; Matt Taddy
  5. Firm Size and Innovation in the Service Sector By David B. Audretsch; Marian Hafenstein; Alexander S. Kritikos; Alexander Schiersch
  6. Performance of livestock production in north eastern cape communal areas: a stochastic frontier analysis. By Gusha, B.; Palmer, A.R.; Villano, R.A.
  7. The production function for housing: evidence from France By Pierre-Philippe Combes; Gilles Duranton; Laurent Gobillon
  8. Motherhood and the Gender Productivity Gap By Yana Gallen
  9. Do EU Funds boost productivity and employment?: Firm level analysis for Latvia By Konstantins Benkovskis; Olegs Tkacevs; Naomitsu Yashiro
  10. Stepping on toes in the production of knowledge: A Meta-Regression Analys By Tiago Sequeira; Pedro Cunha Neves
  11. Foreign Ownership and Skillbiased Technological Change By Michael Koch; Marcel Smolka
  12. How did technical change affect land use in Brazilian agriculture? By Queiroz, P.; Silva, F.D.F.; Fulginiti, L.
  13. A critical review of the main methods to treat undesirable outputs in DEA By Halkos, George; Petrou, Kleoniki Natalia
  14. Inventory Behavior, Demand, and Productivity in Retail By Maican, Florin; Orth, Matilda
  15. Productivity-Enhancing Reallocation and Capital Structure of Downstream Markets - Empirical Evidence from the European Sugar Market By Wimmer, S.; Sauer, J.
  16. The Micro-Level Anatomy of the Labor Share Decline By Matthias Kehrig; Nicolas Vincent
  17. Holding Affiliation Effects on Performance and Growth: Analysis of Ukrainian Farms By Ostapchuk, I.; Curtiss, J.; Gagalyuk, T.
  18. What are the determinants of labour productivity in Turkey By Munise Tuba Akta?
  19. Trade Exposure and Firms Markup Dynamics in the Food Industry By Curzi, D.; Garrone, M.; Olper, A.

  1. By: Latruffe, L.; Dakpo, K.H.; Desjeux, Y.; Jeanneaux, P.
    Abstract: We assess total factor productivity (TFP) change and its components technological change and efficiency change in French agriculture during 2002-2014 with a novel approach. We use the economically-ideal F re-Primont index which allows for multi-temporal/lateral comparisons. To compare the technology gap change between six types of farming, we provide the first extension of the F re-Primont index to the meta-frontier framework. Results indicate that all types of farming farms had TFP progress. Beef farms had the highest increase in TFP change and efficiency change. The metafrontier analysis indicates that field crop farms technology was the most productive. Acknowledgement :
    Keywords: Research Methods/ Statistical Methods
    Date: 2018–07
  2. By: Gallacher, M.; Lema, D.
    Abstract: This paper explores the returns to managerial ability and his role in determining efficiency in Argentina dairy farms. Using an unbalanced panel data from 2003 through 2009 we estimate production frontiers and technical efficiency effects. Most studies analyzing the impact of human capital in agriculture use the measure of years of schooling of the producer as a proxy for decision-making skills. An alternative measure is used in this paper. The measure was derived by grading decision-making and execution skills of the farmers. Grades were assigned by farm advisors knowledgeable of each farm and producer characteristics. Assigned grades were then used in the production frontiers as inputs to estimate the impact of management skills on firm-level results. A very significant impact of these skills on firm results and on technical efficiency and was found. Acknowledgement :
    Keywords: Livestock Production/Industries
    Date: 2018–07
  3. By: Nivievskyi, O.
    Abstract: In this paper we looked at how various tax incentives affected agricultural productivity growth in Ukraine. The empirical analysis was carried out using Ukraine-wide farm-level accounting data for an unbalanced panel of agricultural enterprises over the period 1995-2014. The results demonstrate that the impact of tax exemptions varies across different groups of agricultural producers and sectors. Overall, however, tax exemptions positively affect agricultural TFP growth, but they turned out to be very cost-inefficient instrument of stimulating TFP growth in agriculture. Also tax exemptions strongly undermined efficiency and productivity convergence in agriculture. Acknowledgement :
    Keywords: Productivity Analysis
    Date: 2018–07
  4. By: Bryan Kelly; Dimitris Papanikolaou; Amit Seru; Matt Taddy
    Abstract: We use textual analysis of high-dimensional data from patent documents to create new indicators of technological innovation. We identify significant patents based on textual similarity of a given patent to previous and subsequent work: these patents are distinct from previous work but are related to subsequent innovations. Our measure of patent significance is predictive of future citations and correlates strongly with measures of market value. We identify breakthrough innovations as the most significant patents – those in the right tail of our measure – to construct indices of technological change at the aggregate, sectoral, and firm level. Our technology indices span two centuries (1840-2010) and cover innovation by private and public firms, as well as non-profit organizations and the US government. These indices capture the evolution of technological waves over a long time span and are strong predictors of productivity at the aggregate, sectoral, and firm level.
    JEL: E22 E32 N1 O3 O4
    Date: 2018–11
  5. By: David B. Audretsch; Marian Hafenstein; Alexander S. Kritikos; Alexander Schiersch
    Abstract: A rich literature links knowledge inputs with innovative outputs. However, most of what is known is restricted to manufacturing. This paper analyzes whether the three aspects involving innovative activity - R&D; innovative output; and productivity - hold for knowledge intensive services. Combining the models of Crepon et al. (1998) and of Ackerberg et al. (2015), allows for causal interpretation of the relationship between innovation output and labor productivity. We find that knowledge intensive services benefit from innovation activities in the sense that these activities causally increase their labor productivity. Moreover, the firm size advantage found for manufacturing in previous studies nearly disappears for knowledge intensive services.
    Keywords: MSMEs, R&D, Service Sector, Innovation, Productivity, Entrepreneurship
    JEL: L25 L60 L80 O31 O33
    Date: 2018
  6. By: Gusha, B.; Palmer, A.R.; Villano, R.A.
    Abstract: This paper assesses the performance of households engaged in livestock production in the north-Eastern Cape communal areas of South Africa. Using a survey data from 120 households from Mgwalana and Mahlungulu village collected in 2015 and 2016, a stochastic frontier model is used to estimate technical efficiency scores and evaluate its determinants among households in a communal production environment where rangelands are the cheapest source of fodder for livestock. The findings of the study revealed that householdsHousehold is referred to people living as a family under one dwelling/house and are regarded as a unit Acknowledgement : Funding for this research was provided by the Water Research Commision and Agricultural Research Council.
    Keywords: Livestock Production/Industries
    Date: 2018–07
  7. By: Pierre-Philippe Combes (Univ Lyon & CNRS & GATE-LSE UMR 5824 & Sciences Po & Centre for Economic Policy Research); Gilles Duranton (Wharton School, University of Pennsylvania & Center for Economic Policy Research, the Spatial Economic Centre at the LSE, and the Rimini Centre for Economic Analysis); Laurent Gobillon (PSE-CNRS & Centre for Economic Policy Research & Institute for the Study of Labor (IZA))
    Abstract: We propose a new nonparametric approach to estimate the production function for housing. Our estimation treats output as a latent variable and relies on the firstorder condition for profit maximisation with respect to nonland inputs by competitive house builders. For parcels of a given size, we compute housing by summing across the marginal products of nonland inputs. Differences in nonland inputs are caused by differences in land prices that reflect differences in the demand for housing across locations. We implement our methodology on newlybuilt singlefamily homes in France. We find that the production function for housing is reasonably well, though not perfectly, approximated by a CobbDouglas function and close to constant returns after correcting for differences in user costs between land and nonland inputs and taking care of some estimation concerns. We estimate an elasticity of housing production with respect to nonland inputs of about 0.80.
    Keywords: Housing, production function
    JEL: R14 R31 R32
    Date: 2017
  8. By: Yana Gallen (Harris School of Public Policy)
    Abstract: Using Danish matched employer-employee data, I compare the relative pay of men and women to their relative productivity as measured by production function estimation. I find that the gender “productivity gap” is 8 percent, implying that almost two thirds of the residual gender wage gap is due to productivity differences between men and women. Motherhood plays an important role, yet it also reveals a puzzle: the pay gap for mothers is entirely explained by productivity, whereas the gap for non-mothers is not. In addition, the decoupling of pay and productivity for women without children happens during their prime-child bearing years. These estimates are robust to a variety of specifications for the impact of observables on productivity, and robust to accounting for endogenous sorting of women into less productive firms using a control-function approach. This paper also provides estimates of the productivity gap across industries and occupations, finding the same general patterns for mothers compared to women without children within these subgroups.
    Keywords: discrimination, wage gap, Labor Productivity
    JEL: J71 J24 J31
    Date: 2018–12
  9. By: Konstantins Benkovskis (OECD); Olegs Tkacevs (OECD); Naomitsu Yashiro (OECD)
    Abstract: This paper investigates the effects of spending the European Regional Development Fund (ERDF) on productivity, employment and other performance indicators of Latvian firms. After controlling for the fact that more productive and larger firms are more likely to benefit from ERDF resources, we find that participation in projects co-financed by the ERDF increases firms’ employment, turnover and capital stock per employee immediately, while it raises their productivity only three years after the launch of such projects. Furthermore, participants that were initially less productive, larger, less capital intensive and more financially leveraged enjoy larger productivity gains. Also, financing capital investment through the ERDF does not result in any productivity gains compared to the case when it is financed through private funding. However, it results in a larger increase in employment, which is possibly partly due to the firm’s plan to increase employment being one of important criteria for selecting the ERDF beneficiaries.
    Keywords: EU funds, firm-level data, productivity, propensity score matching
    JEL: C14 D22 R11
    Date: 2018–12–17
  10. By: Tiago Sequeira (Universidade da Beira Interior and CEFAGE-UBI); Pedro Cunha Neves (Universidade da Beira Interior and CEFAGE-UBI)
    Abstract: Decreasing returns to scale in physical resources in the knowledge production function have been widely considered in the economic growth literature. However, given the heterogeneity of empirical results, it is difficult to access its accurate value. We provide a quantitative meta-analysis of the value of the decreasing returns to physical resources in the knowledge production function (stepping-on-toes effect). This has important policy implications regarding the subsidization of R&D activities and policy measures to facilitate the diffusion of knowledge. We conclude that there is some evidence of publication bias. Moreover, the average size-effect is quite small, around 0.2, which implies a high stepping-on-toes effect. This value tends to be higher when variables linked with international linkages are present, resources allocated to R&D are measured by labour, the knowledge pool is proxied by population, and instrumental variable estimation techniques are employed. On the contrary, the average returns to scale estimate decreases when resources allocated to R&D are measured by population and when only rich countries are included in the sample.
    Keywords: knowledge production function; R&D; research policy; stepping-on-toes; duplication effect.
    JEL: O10 O30
    Date: 2018
  11. By: Michael Koch; Marcel Smolka
    Abstract: We conduct an empirical investigation into the effects of foreign ownership on worker skills using firm-level data from Spain. To control for endogeneity bias due to selection into foreign ownership, we combine a difference-in-differences approach with a propensity score weighting estimator. Our results provide novel evidence that foreign-acquired firms actively raise the skills of their workforce in response to the acquisition by hiring high-skilled workers and providing worker training. To pin down the mechanism, we exploit unique information on whether firms use their foreign parent in exporting to foreign markets. Our results suggest a fundamental role for market access through the foreign parent in explaining skill upgrading in foreign-acquired firms. We reveal substantial productivity gains within foreign-acquired firms and we show that these gains derive from a concurrent effort to raise worker skills and adopt more advanced technology, suggesting a skill bias in technological innovations. We develop a simple theoretical model of foreign ownership featuring technology-skill complementarities in production that can rationalize our findings.
    Keywords: multinational enterprises, mergers and acquisitions, skill-biased technological change, worker training, productivity
    JEL: D22 D24 F23 G34
    Date: 2018
  12. By: Queiroz, P.; Silva, F.D.F.; Fulginiti, L.
    Abstract: How did technical change affect land use in Brazilian agriculture? We use data from the last two Agricultural Censuses of 1995/1996 and 2006 to answer this question for five different regions. We focus on the estimation of the Hicksian bias induced by technical change over this period and found that technical change was, in general, land-using. In the Southeast region, we found labor-saving behavior. Both results can be interpreted in light of the induced innovation hypothesis under Acemoglu s approach that allows testing when prices are not available. Acknowledgement :
    Keywords: Land Economics/Use
    Date: 2018–07
  13. By: Halkos, George; Petrou, Kleoniki Natalia
    Abstract: The treatment of undesirable outputs in Data Envelopment Analysis (DEA) has received great research attention recently. As such and as are presented in this work, there are four possible options to deal with those: first ignoring them from the production function; second treating them as regular inputs; third treating them as normal outputs and fourth performing necessary transformations to take them into account. Also new model propositions for their treatment are being presented. Each method brings with it, benefits and drawbacks which each researcher should take into account at every stage of their research and assess which method is more appropriate to be used.
    Keywords: Environmental efficiency; DEA; undesirable outputs.
    JEL: N5 O44 Q56 Q58
    Date: 2018–12
  14. By: Maican, Florin; Orth, Matilda
    Abstract: This paper studies the factors underlying the heterogeneity in inventory behavior and performance across retail stores. We use a dynamic model of multi-product retailers and local competition to estimate store productivity and consumers' perceived quality of the shopping experience, and we analyze their relationship with inventory behavior and product variety. Using novel and detailed data on Swedish stores and their products, we find that stores learn from demand to improve future productivity. Store productivity is the main primitive that increases inventory turnover and product variety, and this increase is larger for stores with already high inventory turnover. Stores in small markets with intense competition from rivals have higher inventory turnover. Consumers in large markets and markets with large investments in technology benefit from a broader product variety. Counterfactual experiments show that the increase in inventory turnover due to innovations in productivity is three times greater when uncertainty in demand is reduced by 30 percent. Our analysis highlights important trade-offs between productivity and demand that allow retailers to reach high levels of inventory turnover and offer a broad product variety to consumers.
    Keywords: inventory performance; product variety; productivity; supply chain management
    JEL: L11 L13 L25 L81 M21
    Date: 2018–11
  15. By: Wimmer, S.; Sauer, J.
    Abstract: This article is concerned with the measurement of productivity and profitability in sugar beet farming. Following the 2006 announcement to abolish the EU sugar quota in 2017, a reallocation of beet production has been observed. We empirically test to what extent the reallocation contributed to productivity growth in the sector using German farm accountancy data. We find that the importance of productivity differences across farms in determining resource allocation is low, but the relative importance compared to profitability differences has been increased after the announcement. The results further indicate that reallocation is hampered by the capital structure of the sugar factories: the contribution of resource reallocation towards sector productivity growth is larger in catchment areas of private sugar companies compared to companies that are owned by farmers who hold secure delivery rights. Acknowledgement :
    Keywords: Marketing
    Date: 2018–07
  16. By: Matthias Kehrig; Nicolas Vincent
    Abstract: The aggregate labor share in U.S. manufacturing declined from 62 percentage points (ppt) in 1967 to 41 ppt in 2012. The labor share of the typical U.S. manufacturing establishment, in contrast, rose by over 3 ppt during the same period. Using micro-level data, we document a number of striking facts: (1) there has been a dramatic reallocation of value added to "hyper- productive" (HP) low-labor share establishments, with much more limited reallocation of inputs; (2) HP establishments have only a temporarily lower labor share that rebounds after five to eight years to the level of their peers; (3) selection into HP status has become increasingly correlated with past size; (4) labor share dynamics are driven by revenue total factor labor productivity, not wages or capital intensity; (5) employment has become less responsive to positive technology shocks over time; and (6) HP establishments enjoy a product price premium relative to their peers that causes their high (revenue) productivity. Counterfactual exercises indicate that selection along size rather than shocks or responsiveness to them is the primary driver of the labor share decline.
    JEL: E2 L1 L20 L6 O4
    Date: 2018–11
  17. By: Ostapchuk, I.; Curtiss, J.; Gagalyuk, T.
    Abstract: This paper aims to investigate productivity and profitability growth in the context of changing farm structure in Ukraine. We address the question of how different farm types, concretely holding enterprises and non-holdings have comparatively performed on the background of their different business strategies. We found that there are no significant differences in terms of productivity between them. Additionally, these results reveal that further research should include corporate level analysis of holdings in order to capture the effects of diversification, since internal management practices, peculiarities of organizational and governance structures as well as inter-subsidiary relationships may tangle the analysis of affiliation effects. Acknowledgement :
    Keywords: Productivity Analysis
    Date: 2018–07
  18. By: Munise Tuba Akta? (Anadolu University)
    Abstract: Labour productivity is seen as a significant determinant of welfare level in the long run. In this perspective,in the study focus on evaluating determinants of labour productivity.This study aims to reveal the determinants of Turkey?s aggregate labour productivity using annual data for the 1970-2015 period. We use vector autoregressive (VAR) model. In the study labour productivity is determined by real net capital stock, wage, secondary education, and trade openness, Johansen cointegration test results show that there is no cointegration between variables in the long-run. Granger casuality test results show that there is a casuality from secondary education to labour productivity in the short-run. There is also a casuality from wage to productivity in the short-run.
    Keywords: Labour Productivity, Turkey, VAR Analsyis
    JEL: J24
    Date: 2018–10
  19. By: Curzi, D.; Garrone, M.; Olper, A.
    Abstract: By examining the roles played by imports of intermediate inputs and final goods separately, this paper investigates the relationship between trade exposure, firm-level markups and industry markup dispersion. We exploit a rich micro-level dataset of French food companies from 2001 to 2013 and find a negative (positive) effect of an increased output (input) import competition on firm-level markups. This result is consistent with the recent predictions of the international trade literature. A similar pattern holds when considering the relationship between trade exposure and industry markup dispersion. We provide a theoretical intuition behind these findings, which represent an important insight introduced by our analysis. Acknowledgement :
    Keywords: International Relations/Trade
    Date: 2018–07

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