nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2021‒11‒22
sixteen papers chosen by

  1. Decomposing Productivity Change in the Presence of Environmental Variables By Rossi, Martin
  2. Performance Analysis: Economic Foundations & Trends By Valentin Zelenyuk
  3. The Performance of Privatized Utilities: Evidence from Latin America By Rossi, Martin
  4. Irrigation Governance, Private Investment, and Agricultural Productivity in India By Bathla, Seema; Kumar, Anjani; Elumalai, K.; Saroj, Sunil
  5. Does Technical Efficiency of Smallholders Threaten Forest conservation? Evidence from the Oil Palm Sector in Indonesia By Dalheimer, Bernhard; Kubitza, Christoph; Bruemmer, Bernhard
  6. Efficiency Analysis with Stochastic Frontier Models using Popular Statistical Softwares By Bao Hoang Nguyen; Robin C. Sickles; Valentin Zelenyuk
  7. Does Soil and Water Conservative Practices Influence Crop Productivity and Household Welfare? Evidence from Rural Nigeria By Ogunniyi, Adebayo; Olagunju, Kehinde Oluseyi; Omotayo, Olusola; Awotide, Bola Amoke; Oyeyemi, Motunrayo; Mavrotas, George
  8. Productivity Differences in Small Scale Palm Oil Processors Using Different Processing Technologies in Ghana By Osei-Mensah, Isaac; Asante, Bright Owusu; Owusu, Victor; Donkor, Emmanuel; Boansi, David
  9. Potential efficiency gains and expenditure savings in the Italian Regional Healthcare Systems By Dino Rizzi; Michele Zanette
  10. Profit Efficiency of Cassava Production By Small Holder Farmers in Enugu State, Nigeria By Okorie, Oguejiofor; Umaru, Ibrahim; Obetta, Angela; Awoyelu, Festus
  11. Do workers, managers, and stations matter for effective policing? A decomposition of productivity into three dimensions of unobserved heterogeneity By Chaudhary, Amit
  12. Institutional Integration and Productivity Growth: Evidence from the 1995 Enlargement of the European Union By Campos, Nauro F.; Coricelli, Fabrizio; Franceschi, Emanuele
  13. The Determinants of Competitiveness of the Portuguese Defense Industry By Roxanne Merenda
  14. Does Universal Electrification Shield Firms from Productivity Loss? By Kehinde Abiodun; Ben Gilbert
  15. Technical Efficiency Effects on Poverty Dynamics Among Cassava-Based Farming Households in Rural Nigeria By Obayelu, Oluwakemi; Obayelu, Abiodun; Awoku, Ifeoluwa Tunrayo
  16. Understanding productivity:Organisational Capital perspectives By Nigel Driffield; Jun Du; Jan Godsell; Mark Hart; Katiuscia Lavaratori; Steven Roper; Irina Surdu; Wanrong Zhang

  1. By: Rossi, Martin
    Abstract: This paper provides a decomposition of labor productivity growth into contributions associated with technical change, efficiency change, returns to scale, and environmental variables. The decomposition is based on parametric estimation of labor requirement functions. This approach is applied to a panel of Latin American distribution utilities between 1994 and 2001. The main results are a positive labor productivity growth averaging 7.5% per year, and that this is mainly due to a shift in the frontier.
    Keywords: Productivity, Electricity Distribution, Labor Requirement Function, Efficiency
    JEL: L94
    Date: 2021–11–07
  2. By: Valentin Zelenyuk (School of Economics, University of Queensland, Brisbane, Qld 4072, Australia)
    Abstract: The goal of this monograph is to very concisely outline the economic theory foundations and trends of the field of Efficiency and Productivity Analysis, also sometimes referred to as Performance Analysis. We start with the profit maximization paradigm of mainstream economics, use it to derive a general profit efficiency measure and then present its special cases: revenue maximization and revenue efficiency, cost minimization and cost efficiency. We then consider various types of technical and allocative efficiencies (directional and Shephard’s distance functions and related Debreu-Farrell measures as well as non-directional measures of technical efficiency), showing how they fit or decompose the profit maximization paradigm. We then cast the efficiency and productivity concepts in a dynamic perspective that is frequently used to analyze the productivity changes of economic systems (firms, hospitals, banks, countries, etc.) over time. We conclude this monograph with an overview of major results on aggregation in productivity and efficiency analysis, where the aggregate productivity and efficiency measures are theoretically connected to their individual analogues.
    Date: 2021–10
  3. By: Rossi, Martin
    Abstract: This article analyzes the relative performance of recently privatized Latin American electricity distribution utilities. Empirical results show that privatized firms are more efficient in their use of labor and have higher labor productivity growth rates than public or cooperative companies. There is also evidence of increasing returns to scale.
    Keywords: Ownership, Efficiency, Technical Change, Input Requirement Function
    JEL: L94 O30
    Date: 2021–11–07
  4. By: Bathla, Seema; Kumar, Anjani; Elumalai, K.; Saroj, Sunil
    Keywords: Agricultural and Food Policy, Productivity Analysis
    Date: 2021–08
  5. By: Dalheimer, Bernhard; Kubitza, Christoph; Bruemmer, Bernhard
    Keywords: Resource /Energy Economics and Policy
    Date: 2021–08
  6. By: Bao Hoang Nguyen (School of Economics, University of Queensland, Brisbane, Qld 4072, Australia); Robin C. Sickles (Economics Department, Rice University, Houston, TX 77251-1892, USA); Valentin Zelenyuk (School of Economics and Centre for Efficiency and Productivity Analysis, University of Queensland, Brisbane, Qld 4072, Australia)
    Abstract: Our chapter provides a brief introduction to the stochastic frontier paradigm - one of the most powerful techniques for performance analysis developed over the last few decades to address various research questions for many contexts with empirical applications in a wide variety of economic sectors such as banking, healthcare, agriculture, and so on. We also document the estimation routines used to implement the classical models as well as the recent developments in this research area for practitioners, especially those who are willing to use Stata, but also with tips on sources for R and Matlab users.
    Keywords: Technical efficiency, Stochastic frontier analysis, Panel data, Semi-parametric, Stata, Matlab, R.
  7. By: Ogunniyi, Adebayo; Olagunju, Kehinde Oluseyi; Omotayo, Olusola; Awotide, Bola Amoke; Oyeyemi, Motunrayo; Mavrotas, George
    Keywords: Productivity Analysis, Environmental Economics and Policy
    Date: 2021–08
  8. By: Osei-Mensah, Isaac; Asante, Bright Owusu; Owusu, Victor; Donkor, Emmanuel; Boansi, David
    Keywords: Production Economics
    Date: 2021–08
  9. By: Dino Rizzi (Department of Economics, University Of Venice CÃ Foscari); Michele Zanette (Department of Economics, University Of Venice CÃ Foscari)
    Abstract: The paper aims to analyse the extent to which the adoption of best practice policies could improve the efficiency of Italian Regional Healthcare Systems (RHSs) and reduce public healthcare expenditures. By means of a stochastic frontier model we estimate the RHSs’ technical inefficiency and its determinants using a panel data of 16 regions over the period 2010-2016. We use the Essential Levels of Care (LEA) scores computed by the Ministry of Health as a proxy for the RHSs’ output and public healthcare expenditure as the main input. The level of inefficiency is a function of a set of variables summarising the organisational arrangements implemented by RHS policymakers. The results allow us to identify the best-practice policy, defined as the set of observable organisational arrangements that maximises aggregate efficiency. Adoption of the best-practice policy by all RHSs leads to potential efficiency gains of 1.5 per cent on average (from 93.4 per cent to 94.9 per cent) and to potential healthcare expenditure savings of 1.8 billion euro in 2016 (1.77 per cent of current expenditures).
    Keywords: Healthcare expenditure, regional healthcare systems, efficiency, LEA scores
    JEL: H51 H75 I18 R50
    Date: 2021
  10. By: Okorie, Oguejiofor; Umaru, Ibrahim; Obetta, Angela; Awoyelu, Festus
    Keywords: Crop Production/Industries
    Date: 2021–08
  11. By: Chaudhary, Amit (University of Warwick)
    Abstract: Misallocation of resources in an economy makes firms less productive. I document the roles of heterogeneity, sorting, and complementarity in a framework where workers, managers, and firms interact to shape productivity. The approach I follow uses the movement of workers and managers across firms to identify the distribution of productivity. I webscraped novel microdata of crime reports from the Indian police department and combined them with the worker-level measurement of productivity. Using this data I show that the third source of heterogeneity in the form of manager ability is an important driver of differences in firm productivity. I empirically identify complementarities between workers, managers, and firms using my estimation methodology. Counterfactual results show that reallocating workers by applying a positive assortative sorting rule can increase police department productivity by 10%.
    Date: 2021
  12. By: Campos, Nauro F. (University College London); Coricelli, Fabrizio (Paris School of Economics); Franceschi, Emanuele (Paris School of Economics)
    Abstract: This paper studies the productivity effects of integration deepening. The identification strategy exploits the 1995 European Union (EU) enlargement, when all candidate countries joined the Single Market but one — Norway — did not join the EU. Our synthetic difference-in-differences estimates on sectoral and regional data suggest had Norway chosen deeper integration, the average Norwegian region would have experienced an increase in yearly productivity growth of about 0.6 percentage points. This method also helps determining the sources of heterogeneity, apparently inherent to integration, highlighting higher costs of the missed deeper integration for more peripheral regions and industrial sector.
    Keywords: institutional integration, economic integration, productivity growth, European Union, European Economic Area
    JEL: C33 F15 F55 O43 O52
    Date: 2021–11
  13. By: Roxanne Merenda
    Abstract: This paper exploits a panel data ranging from 2010 to 2019 to investigate firm-level determinants of export intensity in the Portuguese defense industry, using a fixed effects model. As in any study exploiting corporate finance panel data, it is likely that some variables are endogenous due to reverse causality. Although we address this issue, the interpretation of our results cannot be fully causal. We find evidence that learning economies, proxied by export persistence, are the largest determinants associated with export intensity at firm level. Worker productivity and firm size also play a positive and significant role. Financial indicators such as financial pressure and leverage ratio negatively correlate with export intensity, albeit not always significantly. Finally, and contrary to the literature, we cannot find evidence that the Portuguese defense industry’s competitiveness rely on investment and R&D, nor is it impacted by geographical agglomeration.
    Keywords: Exports, Competitiveness, Firm-level data, Defense industry
    JEL: D22
    Date: 2021–11
  14. By: Kehinde Abiodun (Department of Economics and Business, Colorado School of Mines); Ben Gilbert (Department of Economics and Business, Colorado School of Mines)
    Abstract: Universal electrification is a necessary but not sufficient condition for reliable electricity supply. We examine the effect of power outages on firm performance in four middle-income countries with universal electrification. Using data from the World Bank Enterprise Survey on over 8,000 firms from 39 regions across Egypt, Morocco, Tunisia, and Indonesia, we find no discernable average effect on firm performance. There is considerable cross-country heterogeneity, however. Firms in Tunisia and Egypt --- the two countries in our sample with the greatest frequency of outages --- suffer statistically and economically significant losses from outages, while firms in Indonesia and Morocco show no effect. The losses are high in both Tunisia and Egypt, where outages reduce total annual sales by 15 and 25 percent, respectively. These findings suggest that while universal electrification is an important development goal, it should be considered together with investments in reliability.
    Keywords: universal electrification, power outages, reliability, middle-income countries
    JEL: D24 H54 O13 O14
    Date: 2021–09
  15. By: Obayelu, Oluwakemi; Obayelu, Abiodun; Awoku, Ifeoluwa Tunrayo
    Keywords: Food Security and Poverty, Consumer/Household Economics
    Date: 2021–08
  16. By: Nigel Driffield (Warwick Business School, University of Warwick, Enterprise Research Centre); Jun Du (Aston Business School, Aston University, Enterprise Research Centre); Jan Godsell (Loughborough School of Business, Loughborough University); Mark Hart (Aston Business School, Aston University, Enterprise Research Centre); Katiuscia Lavaratori (Henley Business School, University of Reading); Steven Roper (Warwick Business School, University of Warwick, Enterprise Research Centre); Irina Surdu (Warwick Business School, University of Warwick, Enterprise Research Centre); Wanrong Zhang (WMG, University of Warwick)
    Keywords: organisational capital, productivity
    Date: 2021–11

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