nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2023‒04‒10
nine papers chosen by

  1. Total Factor Productivity: Exploring firms’ dynamics and heterogeneity over the business cycle By Roman Fossati; Heiko Rachinger
  2. Robots and Workers: Evidence from the Netherlands By Acemoglu, Daron; Koster, Hans R.A.; Ozgen, Ceren
  3. Doing Less, with Less: Capital Misallocation, Investment and the Productivity Slowdown in Australia By Jonathan Hambur; Dan Andrews
  4. A portrait of AI adopters across countries: Firm characteristics, assets’ complementarities and productivity By Flavio Calvino; Luca Fontanelli
  5. Globalization, Productivity Growth, and Labor Compensation By Dreger, Christian; Fourné, Marius; Holtemöller, Oliver
  6. Modeling Determinants of Private Banks Profitability in Ethiopia By mohammed, habib
  7. The History of Energy Efficiency in Economics: Breakpoints and Regularities By Louis-Gaëtan Giraudet; Antoine Missemer
  8. On the direct and indirect effects of ICT on SMEs export performance. Evidence from Colombian manufacturing By Andrés Mauricio Gomez-Sanchez; Juan A. Máñez Castillejo; Juan Alberto Sanchis-Llopis
  9. Accounting for the slowdown in output growth after the Great Recession: A wealth preference approach By Kazuma Inagakli,; Yoshiyasu Ono; Takayuki Tsuruga

  1. By: Roman Fossati; Heiko Rachinger
    Keywords: Total factor productivity, heterogeneity, entry and exit, firm and industry level productivity, productivity decomposition
    JEL: L16 L60 O30 O47
    Date: 2021–11
  2. By: Acemoglu, Daron (MIT); Koster, Hans R.A. (Vrije Universiteit Amsterdam); Ozgen, Ceren (University of Birmingham)
    Abstract: We estimate the effects of robot adoption on firm-level and worker-level outcomes in the Netherlands using a large employer-employee panel dataset spanning 2009-2020. Our firm-level results confirm previous findings, with positive effects on value added and hours worked for robot-adopting firms and negative outcomes on competitors in the same industry. Our worker-level results show that directly-affected workers (e.g., bluecollar workers performing routine or replaceable tasks) face lower earnings and employment rates, while other workers indirectly gain from robot adoption. We also find that the negative effects from competitors' robot adoption load on directly-affected workers, while other workers benefit from this industry-level robot adoption. Overall, our results highlight the uneven effects of automation on the workforce.
    Keywords: robots, workers, technology, productivity, the Netherlands
    JEL: D63 E22 E23 E24 J24 O33
    Date: 2023–03
  3. By: Jonathan Hambur (Reserve Bank of Australia); Dan Andrews (e61 Institute)
    Abstract: Productivity growth has slowed in Australia in recent decades. Previous research highlighted the roles of persistently weak non-mining investment and a pervasive decline in economic dynamism, including slower reallocation of labour from low- to high-productivity firms. While these facts have so far been considered separately, this paper attempts to connect them by documenting investment patterns for firms with different levels of productivity. We find that more productive firms are more likely to invest and expand their capital stock than less productive firms, but the extent to which this is true has declined over time. This has weighed on productivity, output and incomes through lower aggregate investment, and also through a less efficient allocation of that investment. We find evidence that capital reallocation slowed more in sectors that were more dependent on external finance, pointing to financing frictions as potentially playing a role. Declines have also been more pronounced in sectors with increasing mark-ups, suggesting that weaker competition may have blunted incentives for firms to expand and improve or exit.
    Keywords: productivity; dispersion; firm-level; BLADE
    JEL: C23 C55 D22 D30 E23 E24
    Date: 2023–03
  4. By: Flavio Calvino; Luca Fontanelli
    Abstract: This report analyses the use of artificial intelligence (AI) in firms across 11 countries. Based on harmonised statistical code (AI diffuse) applied to official firm-level surveys, it finds that the use of AI is prevalent in ICT and Professional Services and more widespread across large – and to some extent across young – firms. AI users tend to be more productive, especially the largest ones. Complementary assets, including ICT skills, high-speed digital infrastructure, and the use of other digital technologies, which are significantly related to the use of AI, appear to play a critical role in the productivity advantages of AI users.
    Keywords: AI, artificial intelligence, productivity, technology adoption
    Date: 2023–04–11
  5. By: Dreger, Christian (DIW Berlin); Fourné, Marius (IWH Halle); Holtemöller, Oliver (IWH Halle)
    Abstract: We analyse how changes in international trade integration affect productivity and the functional income distribution. To account for endogeneity, we construct a leave-out measure for international trade integration for country-industry pairs using international input-output tables. First, we corroborate on the country-industry level that international trade integration increases productivity. Second, we show that international trade integration is associated with higher labour shares in advanced countries but with lower labour shares in manufacturing industries in emerging markets. Finally, we briefly discuss the implications of our results for a possible throwback in international trade integration due to experiences from recent crises.
    Keywords: global value chains, income distribution, globalization, labor share, productivity
    JEL: F4 F6 J3
    Date: 2023–03
  6. By: mohammed, habib
    Abstract: Profitability of financial institutions play a vital role in determining the effectiveness and efficiency of the financial system globally and it is dominated by the banking industry. These banks generates profits that results panel data that requires panel model to analyze and explore determinant factors associated with its profitability. The aim of this article to model determinants of private banks profitability in Ethiopia during 2012–2021 considering its dynamic nature. Return on assets, return on equity, and net interest margin were used as profitability indicators and analyzed using dynamic panel model estimation methods based on system generalized moment estimation techniques. The exploratory data analysis result showed the profitability; return on asset was seems stable while return on equity was decreased and net interest margin was increased with decreasing rate. The model specification result showed one-step system generalized moment method estimation was an appropriate estimation technique as model estimation result directs lagged profitability, capital adequacy, asset quality and branch of banks have positive significant effect on private banks profitability. Similarly inflation rate and economic growth rate have positively determine private banks profitability on macroeconomic side. Despite to this results liquidity was significant negative bank specific determinant of private banks profitability in Ethiopia. The study result recommends consideration on capital adequacy, asset quality, liquidity, branch of banks for the private banks profitability. In addition, this study will call upcoming research to include other financial determinants suggests such as credit risk and non-performing loan with improving the estimation method of panel autoregressive distributed lag models for modeling private banks profitability in Ethiopia.
    Keywords: Dynamic Panel Model, Ethiopia, Generalized Moment Method, Panel Data, Private Banks, Profitability
    JEL: C10
    Date: 2023–03–16
  7. By: Louis-Gaëtan Giraudet (ENPC - École des Ponts ParisTech, CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique); Antoine Missemer (CNRS - Centre National de la Recherche Scientifique, CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Taking a long-run historical perspective, we analyze how debates about energy efficiency have evolved in the economic literature since the mid-19th century. We distinguish three periods: the classical age, focused on the rebound effect, from Jevons in the 1860s to American institutionalism in the mid-20th century; the modern age, marked by the rise of the energy efficiency gap concept, from the 1970s to the 1990s; the contemporary age, from the early 2000s onwards, focused on the concept of energy performance gap. We find that reflections on energy efficiency have embraced more general developments in the economics discipline: emergence of institutionalism in the classical age, primarily concerned with policy; public economics in the modern age, emphasizing the concept of market failure; behavioral economics and the so-called credibility revolution in empirical economics in the contemporary age, which made energy efficiency a much-favored context for conducting experiments, questioning rationality and implementing nudges. The transitions between phases closely paralleled changes in societal concerns, from resource depletion in the classical age to energy security in the modern age to climate change in the contemporary age. Throughout this long history, we have detected a change in focus from macro- to micro-perspectives. Despite increasing sophistication and constant reinterpretation, energy efficiency remains a subject of controversy, such that no consensus has yet been reached on its potential and effective benefits. In closing, we propose to update Jaffe, Newell and Stavins' landmark energy efficiency gap framework to account for the most recent developments and trace avenues for future research.
    Keywords: energy efficiency, energy conservation, rebound effect, market barriers and failures, nudge, empirical turn, history of economic thought
    Date: 2023
  8. By: Andrés Mauricio Gomez-Sanchez (Universidad del Cauca, Colombia.); Juan A. Máñez Castillejo (Universidad de Valencia and ERICES, Valencia, España.); Juan Alberto Sanchis-Llopis (Universidad de Valencia and ERICES, Valencia, España.)
    Abstract: The objective of this document is to explore the effect of ICT on the performance of Colombian manufacturing SMEs in export markets. To our knowledge, this is the first piece of evidence that explores this issue for an emerging economy. In doing so, we include some cutting-edge novelties such as persistence in export intensity; cross effect from imports to exports, and the role of initial conditions problem. We replicate the Tobit II-Heckman model procedure by using a dynamic Generalized Linear Model (GLM) because the export intensity is a proportion and include the inverse Mills ratio to deal with the selection problem. We merge three databases namely The Annual Manufacturing Survey (EAM); the Innovation and Technological Development Survey (EDIT) and the Annual ICT Manufacturing Survey (EAM-TIC); published by the National Administrative Department of Statistics (DANE) in six waves since 2013 to 2018. In general, our main results suggest that the impacts of information technologies on export intensity are always positive, regardless of the ICT analysed. Other results show persistence in exports, cross effects and self-selection in export markets, among others.
    Keywords: ICT, Exports, Sunk costs, Cross effects, Empirical Studies of Trade, Emerging economies, Empirical Analysis
    JEL: L16 L96 F14 O33 C23 D22 D24
    Date: 2023–04
  9. By: Kazuma Inagakli,; Yoshiyasu Ono; Takayuki Tsuruga
    Abstract: Previous studies have argued that US output growth declined persistently after the Great Recession. To explain the persistent slowdown in output growth, we develop a simple model that incorporates wealth preferences and downward nominal wage rigidity into a standard monetary growth model. Our model predicts that output initially grows at a constant steady rate and slows endogenously afterward. In the model, persistent stagnation occurs together with the declining real interest rate. Applying our model to the US data, we show that it successfully explains the slowdown in output growth along with the declines in the real interest rate. We also examine the model with the Japanese data. The model replicates the persistent stagnation that has been observed since the 1990s.
    Date: 2022–05

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