nep-eff New Economics Papers
on Efficiency and Productivity
Issue of 2023‒11‒13
eight papers chosen by
Angelo Zago, Università degli Studi di Verona

  1. Migration and Productivity in the UK: An Analysis of Employee Payroll Data By Nam, Hoseung; Portes, Jonathan
  2. Inference in Dynamic, Nonparametric Models of Production for General Technologies By Simar, Léopold; Wilson, Paul
  3. Tax structure and public sector efficiency: new evidence for developing countries By Lucas Menescal; José Alves
  4. Empirical Determinants of Innovation in European Countries: Testing the Porter's Hypothesis By Makrevska Disoska, Elena; Tonovska, Jasna; Toshevska-Trpcevska, Katerina; Tevdovski, Dragan; Stojkoski, Viktor
  5. There are different shades of green: heterogeneous environmental innovations and their effects on firm performance By Gianluca Biggi; Andrea Mina; Federico Tamagni
  6. Power outages and firm performance: a hydro-IV approach for a single electricity grid By Elliott, Robert J.R.; Nguyen-Tien, Viet; Strobl, Eric A.
  7. Does Artificial Intelligence benefit UK businesses? An empirical study of the impact of AI on productivity By Sam Hainsworth
  8. The Impact of Mergers and Acquisitions on Operational Performance of Islamic Banking sector By Ullah, Nazim

  1. By: Nam, Hoseung (King's College London); Portes, Jonathan (King's College London)
    Abstract: We investigate the impact of immigration on productivity in the UK, using newly published ONS data on employees of non-UK origin by region and sector. Consistent with earlier research, we find some evidence of a positive association between non-EU migration and productivity, and some weaker evidence of a negative association between EU migration and productivity, although results are sensitive to the specifications used.
    Keywords: migration, productivity, labour markets, Brexit
    JEL: F22 J48 J61 J68
    Date: 2023–09
  2. By: Simar, Léopold (Université catholique de Louvain, LIDAM/ISBA, Belgium); Wilson, Paul (Clemson University)
    Abstract: Nonparametric envelopment estimators are often used to estimate the attainable set and its efficient boundary, and to assess efficiency and changes in productivity. Kneip et al (2021) provide asymptotic results that can be used to make inference about expected changes in productivity measured by Malmquist indices and about the sources of productivity changes. These results require convexity of the attainable set, but in a number of situations this assumption is questionable. Recently, Kneip et al (2022) extend these results to allow for possibly non-convex technologies where the DEA estimators are known to be inconsistent. This paper summarizes these results, and explains how researchers should choose the appropriate method in a particular application.
    Keywords: Nonparametric production frontiers ; DEA ; FDH ; Malmquist Indices
    Date: 2023–10–09
  3. By: Lucas Menescal; José Alves
    Abstract: This study examines the effects of the tax structure composition for public sector efficiency in a sample of 41 developing countries for the period between 1997-2019. We start by calculating Public Sector Performance (PSP) composite indicators and use them as outputs to compute data envelopment analysis (DEA) efficiency scores under different orientation setups. After using a general-to-specific approach to identify the most determinant variables, we analyze the relevance of different taxes for public efficiency in a panel regression specification. We find that tax effects are significantly different depending on the orientation of DEA scores. Notably, we observe that taxation presents stronger detrimental effects to input-oriented scores in comparison to output-oriented, and that Opportunity PSP indicators seem more affected by property taxes and working contributions, while Musgravian PSP indicators are more closely related to individual and corporate income taxes. Our results allow us to provide policy implications regarding better tax structures to improve efficiency on the provision of public goods and services.
    Keywords: Public sector performance; Government efficiency; Tax structure; Data envelopment analysis; Developing countries; Panel data.
    JEL: C14 C23 H11 H21 H50
    Date: 2023–10
  4. By: Makrevska Disoska, Elena; Tonovska, Jasna; Toshevska-Trpcevska, Katerina; Tevdovski, Dragan; Stojkoski, Viktor
    Abstract: We investigate the interplay between innovation and productivity, emphasizing the role of environmental regulations on the innovation behaviours of European firms. Anchored in the Porter hypothesis, which proposes that environmental regulations can drive technological innovation and bolster commercial competitiveness, we utilize the CDM model (Crépon, Duguet, and Mairesse, 1998) for in-depth analysis. Our approach begins by pinpointing the factors that shape firms' decisions to innovate and the associated investments, employing the Heckman correction model. Subsequently, we adopt the three-stage least squares (3SLS) methodology to analyse both innovation outputs and firm productivity in tandem. Drawing data from the Community Innovation Survey (CIS) 2018, our structured examination unveils how diverse innovation drivers can elevate labor productivity in varied institutional landscapes. By contrasting the performance of South Europe (comprising Greece, Spain, Portugal) and Central Eastern Europe (countries like Bulgaria, Estonia, Hungary) against a German benchmark, our research offers a nuanced understanding of environmental regulations' influence on innovation and productivity across European contexts.
    Keywords: innovation, productivity, CDM model, CIS, Porter`s hypothesis
    JEL: C33 C36 O31 O33
    Date: 2023–09–29
  5. By: Gianluca Biggi; Andrea Mina; Federico Tamagni
    Abstract: Using a firm-level dataset from the Spanish Technological Innovation Panel (2003-2016), this study explores the characteristics of environmentally innovative firms and quantifies the effects of pursuing different types of environmental innovation strategies (resource-saving, pollution-reducing, and regulation-driven innovations) on sales, employment, and productivity dynamics.
    Date: 2023–10
  6. By: Elliott, Robert J.R.; Nguyen-Tien, Viet; Strobl, Eric A.
    Abstract: We estimate the impact of power outages on firm performance using a hydro-instrumental variable strategy which integrates a river flow with a hydropower generation model and an electricity-grid-based distance interpolation technique. Comparing World Bank Enterprise Surveys in 2005 and 2015 for Vietnam, we find that despite considerable economic progress, firms have become more susceptible to power outages. Our estimates suggest that reducing the length of power cuts by 1% would have increased revenues by 4.66 billion USD. Other results show that firms with less reliable electricity have lower productivity and use less flexible inputs, which is not mitigated by backup generators.
    Keywords: firm performance; growth; instrumental variables; power outages; Vietnam
    JEL: O13 Q54 R11 N55
    Date: 2021–11–01
  7. By: Sam Hainsworth
    Abstract: Media hype and technological breakthroughs are fuelling the race to adopt Artificial Intelligence amongst the business community, but is there evidence to suggest this will increase productivity? This paper uses 2015-2019 microdata from the UK Office for National Statistics to identify if the adoption of Artificial Intelligence techniques increases labour productivity in UK businesses. Using fixed effects estimation (Within Group) with a log-linear regression specification the paper concludes that there is no statistically significant impact of AI adoption on labour productivity.
    Date: 2023–10
  8. By: Ullah, Nazim
    Abstract: Merger and acquisition (hereafter M&A) is the business expansion strategy. Islamic bank is the niche banking sector compared to its peers while it is categorized as too small to succeed. The paper aims to analyze the impact of M&A on the operational performance of the Islamic banking sector. This study employs empirical research methods, namely cross-sectional pooled regression and panel data regression to analyse a set of samples consisting of 10 Islamic banks involved in M&A from 6 countries, drawn from the International Monetary Fund (IMF), World bank, FicthConnect and Bloomberg over the years of 2009Q1 to 2018Q4. The operational performance is estimated using accounting-based measures while the Herfindahl-Hirschman Index (HHI) and the concentration ratio (CR) are applied to signify market structure. Total assets, total deposits and operating income variables are used to represent bank size. The findings indicate that bank size shows negative impact on operational performance. While the segregated level of bank size which is larger banks and concentrated market structure have a greater impact on the operational performance of Islamic banks in the post-M&A period. The paper concludes by discussing policy implications for policy-makers and academicians for having the strategic decision on the M&A deal and further research.
    Keywords: Bank Sizes, Islamic Banking, M&A, Market Structure, Operational Performance
    JEL: G34
    Date: 2022–12–07

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