nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2020‒09‒14
fifteen papers chosen by

  1. Retailing Performance Evaluation Scale for Indian Brick-and-Mortar Lifestyle Retailers (LSRS-b) By H. R., Ganesha; Aithal, Sreeramana
  2. The East-West German gap in revenue productivity: Just a tale of output prices? By Mertens, Matthias; Müller, Steffen
  3. A comparative study of performance of commercial banks in ASIAN developing and developed countries By Asima Siddique; Omar Masood; Kiran Javaria; Dinh Tran Ngoc Huy
  4. A new model of technical change and an application to the Solow model By Mehdi Senouci; Hugo Mauron
  5. Robots and the Gender Pay Gap in Europe By Aksoy, Cevat Giray; Ozcan, Berkay; Philipp, Julia
  6. Empirical interpretation and measurement of the productivity and efficiency of regions: the case of Latvia By Evgeniy Korshenkov; Sergey Ignatyev
  7. Labour Productivity during the Great Depression and the Great Recession in UK Engineering and Metal Manufacture By Hart, Robert A.
  8. Improving Management through Worker Evaluations: Evidence from Auto Manufacturing By Jing Cai; Shing-Yi Wang
  9. The role of innovation in industrial dynamics and productivity growth: a survey of the literature By Ugur, Mehmet; Vivarelli, Marco
  10. Corporate zombies: Anatomy and life cycle By Ryan Niladri Banerjee; Boris Hofmann
  11. A revisit of farm size and productivity: Empirical evidence from a wide range of farm sizes in Nigeria By Omotilewa, Oluwatoba J.; Jayne, Thomas S.; Muyanga, Milu; Aromolaranc, Adebayo; Liverpool-Tasieb, Lenis Saweda O.; Awokuseb, Titus
  12. Impact of Farmland Fragmentation on Farmers' Grain Production Technical Efficiency—A Case Study of Four Counties in Hubei Province, China By Wen, Gaohui; Hu, Xianhui; Li, Mengyao; Yang, Gangqiao
  13. Collateral damaged? Priority structure, credit supply, and firm performance By Geraldo Cerqueiro; Steven Ongena; Kasper Roszbach
  14. Labor Response to Agricultural Productivity Shocks in Developing Countries: Evidence from China By Deininger, Klaus W.; Gao, Xuwen; Jin, Songqing; Peng, Chao
  15. The Effects of the EU Cohesion Policy on Regional Economic Growth: Using Structural Equation Modelling for Impact Assessment By Stefan Jestl; Ambre Maucorps; Roman Römisch

  1. By: H. R., Ganesha; Aithal, Sreeramana
    Abstract: A majority of brick-and-mortar lifestyle retailers in India have adapted firm-level and output-driven measures to evaluate their overall retailing performance in addition to not apportioning the central office expenses incurred merely to run stores on to store’s profit and loss account. This output-driven approach is distracting them from focussing on input variables and efficiency that is inevitably imperative if sustainable retail profit and returns on investment are expected. In this exhaustive empirical study, we have studied a few select organized brick-and-mortar lifestyle retailers to identify 64 variables that directly or indirectly determine the returns on investment of a lifestyle retailer, of which we have chosen 16 input-driven variables to design the LSRS-b instrument in addition to ensuring integration of variables that have a significantly positive association and determination with consumer repeat visit rate, sales personnel consumer orientation, cash flow efficiency, revenue generation, profitability, returns on investment, and consumer-level performance evaluation. Based on 24 months of data evaluated, we have found that these 16 input-driven variables have a significant determination of about 86.90 percent concerning the final output i.e., returns on investment (ROI) which is a strong indicator of the reliability of LSRS-b instrument in evaluating the overall retailing performance of organized brick-and-mortar lifestyle retailers in India.
    Keywords: Indian Retail; Brick-and-Mortar Store; Lifestyle Retailer; Retail Profit; Retail Performance Evaluation; Measuring Retail Performance; Returns on Investment; Retail ROI; Input-Driven Measures; Consumer Orientation; Sales Personnel; Salesperson; Retail Productivity; Consumer-Level Retail Scale; Firm-Level Retail Scale
    JEL: M31 M37
    Date: 2020–06–05
  2. By: Mertens, Matthias; Müller, Steffen
    Abstract: East German manufacturers' revenue productivity (value-added per worker) is some 8 (25) percent below West German levels, even three decades after German unification. Using firm-product-level data containing information on product quantities and prices, we analyse the role of product specialisation and reject the prominent 'extended work bench hypothesis', stating a specialisation of Eastern firms in the intermediate input production as explanation for these sustained productivity differences. We decompose the East's revenue productivity disadvantage into Eastern firms selling at lower prices and producing more physical output for given amounts of inputs within ten-digit product industries. This suggests that Eastern firms specialise vertically in simpler product varieties generating less consumer value but being manufactured with less or cheaper inputs. Vertical specialisation, however, does not explain the productivity gap as Eastern firms are physically less productive for given product prices, implying a genuine physical productivity disadvantage of Eastern compared to Western firms.
    Keywords: German unification,regional productivity gap,physical productivity,product prices,product specialisation
    JEL: D24 L2 L11 O47
    Date: 2020
  3. By: Asima Siddique (COMSATS University Islamabad); Omar Masood (University of Lahore); Kiran Javaria (University of Lahore); Dinh Tran Ngoc Huy (International University of Japan)
    Abstract: The main focus of this study is to investigate the impact of non-performing loans (NPLs) and other bank specific factors on the financial performance of commercial banks in Asian developing and developed countries due to an alarmingly high ratio of non-performing loans.The bank specific factors that are used in this study are cost efficiency ratio (CER), capital adequacy ratio (CAR), size of the bank, sales growth (SG) and proxies of financial performance (FP) are return on equity (ROA) and return on asset (ROE). Secondary Panel data of ten years (2006-2015) has been used for this empirical analysis and 19 commercial banks from developing countries of Asia (Pakistan and India), while 17 commercial banks from developed countries of Asia (Japan and Saudi Arabia) are selected. Generalized method of moment is used for the coefficient estimation to overcome the effects of some endogenous variables. NPLs and CER are significantly negatively related to the financial performance (ROA and ROE) of developing and developed countries commercial banks. There is a negative relationship of bank size with most of financial performance variables. Sale growth and capital adequacy ratio has significant positive relationship both measures of financial performance (ROA and ROE) in both pools. Due to the importance of commercial banks in the overall economy of a country, there is a need for management of commercial banks and regulatory authorities to undertake policies that ensure efficiency in banking operations.
    Keywords: Non-Performing Loans,micro economic variables,Pakistan & India,Japan & Saudi Arabia,GMM approach
    Date: 2020–06–30
  4. By: Mehdi Senouci (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Hugo Mauron (CentraleSupélec)
    Abstract: We present an alternative form of technical change within the traditional two-input framework. The aggregate production function is the convex hull of an increasing, finite number of Leontief production functions. At each date, each of these local production functions mutates into two Leontief production functions: one featuring exogenously increased labor-augmenting productivity, the other featuring exogenously increased capital-augmenting productivity. We embed this model of technical change into an otherwise standard, discrete-time Solow model. We do not specify technical change as purely labor-augmenting; still, it comes out that this modified Solow model has a globally stable balanced growth path. Along this path, technical change jointly determines the growth rate, capital-output ratio, and marginal productivity of capital and the competitive factor shares.
    Keywords: Directed technical change,Uzawa theorem,Balanced growth path,Solow model
    Date: 2020–08–24
  5. By: Aksoy, Cevat Giray (European Bank for Reconstruction and Development); Ozcan, Berkay (London School of Economics); Philipp, Julia (London School of Economics)
    Abstract: Could robotization make the gender pay gap worse? We provide the first large-scale evidence on the impact of industrial robots on the gender pay gap using data from 20 European countries. We show that robot adoption increases both male and female earnings but also increases the gender pay gap. Using an instrumental variable strategy, we find that a ten percent increase in robotization leads to a 1.8 percent increase in the gender pay gap. These results are mainly driven by countries with high levels of gender inequality and outsourcing destination countries. We then explore the mechanisms behind this effect and find that our results can be explained by the fact that men at medium- and high-skill occupations disproportionately benefit from robotization (through a productivity effect). We rule out the possibility that our results are driven by mechanical changes in the gender composition of the workforce nor by inflows or outflows from the manufacturing sector.
    Keywords: industrial robots, gender pay gap, automation, Europe
    JEL: J00 J31 J71
    Date: 2020–07
  6. By: Evgeniy Korshenkov (Baltic International Academy); Sergey Ignatyev (Baltic International Academy)
    Abstract: The main concepts of this study are productivity and efficiency, which are very relevant for Latvia and are reflected both in the latest scientific publications, dissertation researches and analytical reviews of the Latvian ministries and representatives of the European Commission in Latvia, as well as in expert reports published in the press. The objective of this article is empirical interpretation and search of the most corresponding to the terminological background method of measuring of the productivity and efficiency of regions, based on a specific example of the regions of Latvia. The results of the previous authors' research showed that the productivity of region is defined as it`s ability to create as many as possible goods or services per unit of time, while the efficiency is the pure economical term that takes into account the amount of the factors of production utilizied in the production process. Productivity / efficiency of a region is not only the sum of the productivity / efficiency of economical units functioning in this region, as contains a certain "delta"-synergy effect (for factors of production), agglomeration effect (for enterprises) or concentration effect (for industries). Always economically backward Latvia's region (Latgale region) is not with the lowest productivity calculated by the GDP per 1 km 2 of a region's territory-by this indicator less successful in Latvia is Vidzeme region. But by the earnings index, calculated taking into account the sectoral structure of employment in a region, exactly the Latgale region as usually occupies the last place in Latvia, and the Riga region-the first one. To calculate the efficiency of Latvia's regions, the authors relied on neoclassical growth models, which take into account the main classical factors of production-labor, land, capital. By the efficiency in Latvia the Riga region leads expectantly, almost 2 times exceeding the efficiency of Pieriga region, and more than 3 times,-the efficiency of Latgale region. But lowest efficiency in Latvia is not in the Latgale region, but once more in Vidzeme region.
    Keywords: production process,factors of production,productivity,efficiency,regions,Latvia
    Date: 2020–06–30
  7. By: Hart, Robert A. (University of Stirling)
    Abstract: This paper compares labour productivity during the Great Depression (GD) and the Great Recession (GR) in engineering, metal working and allied industries. Throughout, it distinguishes between output per worker and output per hour. From the peak-to-trough of the GD cycle, hourly labour productivity was countercyclical, remaining above its 1929 starting point. In the GR peak-to-trough period, hourly productivity was procyclical, falling below its 2007/08 starting point. While employment and average weekly hours reductions were much more pronounced in the GD compared to the GR, the GD recovery was both stronger and more sustained. The discussion of the different experiences in the two eras concentrates on employment and hours flexibility, the comparative lengths of weekly hours, the behaviour of real wages, and human capital aspects of labour inputs.
    Keywords: labour productivity, Great Depression, Great Recession
    JEL: E32 J23 J24
    Date: 2020–07
  8. By: Jing Cai; Shing-Yi Wang
    Abstract: Using a randomized experiment with an automobile manufacturing firm in China, we measure the effects of letting workers evaluate their managers on worker and firm outcomes. In the treatment teams, workers evaluate their supervisors monthly. We find that providing feedback leads to significant reductions in worker turnover and increases in team-level productivity. In addition, workers report higher levels of happiness and positive mood. The evidence suggests that these results are driven by changes in the behavior of managers and an overall better relationship between managers and workers.
    JEL: D22 O1
    Date: 2020–08
  9. By: Ugur, Mehmet (Institute of Political Economy, Governance, Finance and Accountability, University of Greenwich); Vivarelli, Marco (UNU-MERIT, Maastricht University, Department of Economic Policy, Universita Cattolica del Sacro Cuore, and IZA, Bonn)
    Abstract: We review the theoretical underpinnings and the empirical findings of the literature that investigates the effects of innovation on firm survival and firm productivity, which constitute the two main channels through which innovation drives growth. We aim to contribute to the ongoing debate along three paths. First, we discuss the extent to which the theoretical perspectives that inform the empirical models allow for heterogeneity in the effects of R&D/innovation on firm survival and productivity. Secondly, we draw attention to recent modelling and estimation effort that reveals novel sources of heterogeneity, non-linearity and volatility in the gains from R&D/innovation, particularly in terms of its effects on firm survival and productivity. Our third contribution is to link our findings with those from prior reviews to demonstrate how the state of the art is evolving and with what implications for future research.
    Keywords: Innovation, R&D, Survival, Productivity
    JEL: O31 O32 O33 O40
    Date: 2020–09–03
  10. By: Ryan Niladri Banerjee; Boris Hofmann
    Abstract: Using firm-level data on listed non-financial companies in 14 advanced economies, we document a rise in the share of zombie firms, defined as unprofitable firms with low stock market valuation, from 4% in the late 1980s to 15% in 2017. These zombie firms are smaller, less productive, more leveraged and invest less in physical and intangible capital. Their performance deteriorates several years before zombification and remains significantly poorer than that of non-zombie firms in subsequent years. Over time, some 25% of zombie companies exited the market, while 60% exited from zombie status. However, recovered zombies underperform compared to firms that have never been zombies and they face a high probability of relapsing into zombie status.
    Keywords: zombie companies, firm behaviour, economic dynamism, productivity growth, bankruptcy
    JEL: D22 D24 E43 G33
    Date: 2020–09
  11. By: Omotilewa, Oluwatoba J.; Jayne, Thomas S.; Muyanga, Milu; Aromolaranc, Adebayo; Liverpool-Tasieb, Lenis Saweda O.; Awokuseb, Titus
    Keywords: Agricultural and Food Policy, International Development, Research Methods/Statistical Methods
    Date: 2020–07
  12. By: Wen, Gaohui; Hu, Xianhui; Li, Mengyao; Yang, Gangqiao
    Keywords: Agribusiness, Agricultural Finance, Labor and Human Capital
    Date: 2020–07
  13. By: Geraldo Cerqueiro (Católica-Lisbon School of Business and Economics); Steven Ongena (University of Zürich, Swiss Finance Institute, KU Leuven and CEPR); Kasper Roszbach (Norges Bank and University of Groningen)
    Abstract: A unique legal reform in 2004 in Sweden redistributed collateral rights from banks holding floating liens to unsecured creditors without changing the value of assets on firms' balance sheets. Using a country-wide panel of all incorporated firms, we document that a zero-sum redistribution of collateral rights and the resulting reduction in collateral capacity towards banks contracts the amount and maturity of corporate debt and leads firms to slow investment and forego growth. Altering their allocation of assets, firms reduce particularly those assets with a low collateralizable value for banks and also hoard more cash. However, the reform has no impact on corporate capital intensity or efficiency, suggesting that under these newly binding credit constraints firms simply shrink their operations.
    Keywords: Collateral, investment, financial constraints, difference-in-differences, floating lien, seniority
    JEL: D22 G31 G32
    Date: 2019–05–29
  14. By: Deininger, Klaus W.; Gao, Xuwen; Jin, Songqing; Peng, Chao
    Keywords: Labor and Human Capital, Community/Rural/Urban Development, Resource/Energy Economics and Policy
    Date: 2020–07
  15. By: Stefan Jestl (The Vienna Institute for International Economic Studies, wiiw); Ambre Maucorps (The Vienna Institute for International Economic Studies, wiiw); Roman Römisch (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: This paper analyses the effects of the EU Cohesion Policy (CP) on the economic growth of 276 European NUTS-2 regions between 2008 and 2016. Using a structural equation model (SEM) consisting of both a measurement component (with two latent variables) and a structural component, we estimate the impact of CP funding on the growth of GDP per capita across EU regions. The estimation also enables us to predict changes in the growth of GDP per capita based on a scenario of CP funding reallocation between member states. Overcoming the limitations of traditional linear regression, SEM modelling proves to be a promising method for impact evaluation, also allowing for the inclusion of indirect causal paths and feedback loops to depict, for example, cross-border economic spillover effects.
    Keywords: Cohesion Policy, regional economic growth, structural equation modelling
    JEL: C38 C39 R11 R12 R58
    Date: 2020–08

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