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on Efficiency and Productivity |
| By: | Fischer, Kai; Zheng, Honghao |
| JEL: | D24 L11 L52 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:vfsc25:325360 |
| By: | Masayuki MORIKAWA |
| Abstract: | Using micro-level data on Japanese firms, this study analyzes the relationship between productivity and wages, as well as trends in the labor share, with a focus on comparing aggregate-level and firm-level figures. The main findings are as follows. First, at the macro level, productivity growth and real wage growth are diverging, but, at the firm level, there is a strong positive relationship between productivity growth and wage growth, indicating that productivity and wages have not decoupled. Second, a divergence exists between simple average and aggregate (i.e., weighted-average) wage trends, with aggregate real wages exhibiting a greater downward trend. Third, dynamic Olley-Pakes decomposition reveals that the covariance term contributes negatively to changes in real wages. In other words, the relationship between higher value-added share and higher wages is weakening. In contrast, in relation to productivity, the covariance term has a large positive effect at the aggregate level. These results suggest that while productivity growth is essential for raising real wages, policies that promote productivity through resource reallocation may conflict with those aimed at increasing labor’s share of value-added. |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:eti:rdpsjp:25023 |
| By: | Egger, Hartmut; Elke, Jahn; Meier, Philipp |
| JEL: | F23 R12 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:vfsc25:325399 |
| By: | Kuosmanen, Natalia; Kaitila, Ville; Kuusi, Tero; Kässi, Otto; Maczulskij, Terhi; Pajarinen, Mika |
| Abstract: | Abstract This report examines the factors shaping productivity in Finland’s private service industries. Specifically, we focus on the link between capital intensity and labor productivity, as well as the allocation of labor. In addition, the report highlights the roles of global megatrends, such as offshoring, digital adoption and generative AI, in productivity development. Using firm- and industry-level data, three broad patterns emerge. First, capital intensity in Finnish service industries is consistently below that of peer countries and is closely associated with weaker productivity. Second, firms systematically employ fewer workers than implied by profit-maximizing conditions, with gaps especially pronounced in knowledge-intensive services. Third, digital adoption is uneven: firms with broader use of digital technologies perform better, while many smaller and traditional providers lag behind. Scenario analysis suggests that generative AI could raise economic growth if paired with capital investment, while the offshoring of services does not appear to improve productivity but may support employment and reshape the composition of the workforce. The findings indicate that Finland’s service productivity challenges are long-standing and structural rather than short-term fluctuations. |
| Keywords: | Capital intensity, Digitalization, Offshoring, Productivity, Service industries |
| JEL: | C23 F14 L80 O14 O30 O33 O47 |
| Date: | 2025–09–24 |
| URL: | https://d.repec.org/n?u=RePEc:rif:report:167 |
| By: | Dijkstra, Lewis; Kompil, Mert; Proietti, Paola |
| Abstract: | Between 2001 and 2021, capital metro regions had the fastest productivity growth in the EU, followed by non-metro regions, while it was much lower in other metro regions. Capitals reduced their sectoral concentration, while the other regions increased it. Our shift-share analysis confirms that capitals relied entirely on productivity growth within sectors, while the other two types benefitted also from shifting jobs to more productive sectors. Our regression analysis showed that convergence and being a capital boosted productivity growth. Population density also strengthened productivity growth, but not enough to prevent other-metro regions from lagging behind the non-metro regions. |
| Keywords: | growth; productivity; employment; capital; metro; regions; Europe; EU; ARDECO |
| JEL: | E24 O18 O32 P25 R12 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:129664 |
| By: | Esther Devilliers (BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Niklas Möhring (WUR - Wageningen University and Research [Wageningen]); Robert Finger (Agricultural economics and policy - ETH Zürich - Eidgenössische Technische Hochschule - Swiss Federal Institute of Technology [Zürich]) |
| Abstract: | Low-input production systems aim at mitigating agriculture's environmental impact with a lower level of chemical inputs. However, comparing the performance of low-input systems to conventional ones, particularly in terms of productivity and yield, is challenging due to selection bias. First, we often lack observational data on low-input systems. Then, when available, the comparison between the two production systems is challenging due to potential endogeneity in input use and selection bias. To effectively develop policies promoting the adoption of low-input systems and assess their impact, for example, on pesticide use and yields, it is crucial to employ an econometric framework that addresses these issues. This article proposes an endogenous switching approach combined with control functions to tackle selection bias and input endogeneity simultaneously. Using unbalanced panel data on Swiss wheat production, which includes both low-input and conventional systems, our framework allows us to analyze the differentiated role of inputs as well as their price elasticity for both conventional and low-input farming systems. |
| Keywords: | Control Function, Endogenous Switching Regression, Pesticide Use, Low-input Production Systems |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04157545 |
| By: | Kuosmanen, Natalia; Kaitila, Ville; Kuusi, Tero; Maczulskij, Terhi |
| Abstract: | Abstract Productivity growth in Finland’s service industries has fallen behind that of peer countries, weakening the economy’s growth potential. This policy brief summarizes key findings from ETLA’s recent research on the challenges and opportunities for service-sector productivity. The analyses show that capital intensity in services is low, firms employ fewer workers than profit-maximizing conditions would imply, and digital adoption remains uneven across firms and industries. Service imports increase employment but do not improve productivity. Generative artificial intelligence (GenAI) could provide a new source of growth, but its impact will depend on skills and technology adoption. The brief presents policy recommendations to support investment, skills development, and structural reforms to strengthen productivity in the service sector. |
| Keywords: | Capital intensity, Digitalization, Offshoring, Productivity, Service industries |
| JEL: | F14 L80 O14 O30 O33 O47 |
| Date: | 2025–09–24 |
| URL: | https://d.repec.org/n?u=RePEc:rif:briefs:164 |
| By: | Pérez Urdiales, María; López-Luzuriaga, Andrea; Castillo, Adriana; Couto Ribeiro, Beatriz |
| Abstract: | Achieving universal and equitable access to water and sanitation remains a critical challenge in Latin America and the Caribbean (LAC). This paper assesses the efficiency of public spending in providing water and sanitation services across Colombian municipalities. Efficiency levels are estimated using a stochastic frontier analysis that accounts for unobserved heterogeneity. The results show that the organizational and governance characteristics of service providers play a significant role in shaping spending efficiency. Municipalities with more service providers tend to be less efficient. In contrast, efficiency improves when providers operate across multiple jurisdictions. Additionally, municipalities where the head of the service provider is appointed--rather than elected--demonstrate greater efficiency. Overall, the findings indicate that public expenditures could be reduced by approximately 18\% without compromising service quality, highlighting the potential for substantial gains through improved provider organization and governance. |
| Keywords: | water;Sanitation;fiscal management;public spending;Public Expenditure Review |
| JEL: | Q25 O54 H42 H54 H72 L95 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:idb:brikps:14276 |
| By: | Yantuan Yu (Guangdong University of Foreign Studies); Ning Zhang (Yonsei University) |
| Abstract: | The effect of market-based climate policy instruments on a just transition cannot be underestimated, especially for developing economies. In this study, we provide rigorous empirical evidence on how China’s Energy Quota Trading System(EQTS) can drive green technology innovation and support an equitable, low-carbon transition. Specifically, based on a quasi-experimental modeling framework, we use a Double Debiased Machine Learning method to estimate the casual effect of China’s EQTS on energy productivity. Further, we explore the mechanisms of impact and examine heterogeneity effects from regional, resource endowment, and environmental regulation stringency perspectives. The empirical findings show that EQTS significantly improves energy productivity, exhibiting an average marginal effect of 13.2%. Robustness checks confirm the validity of the results after controlling for potential confounders. Green technology innovation and energy transition function as critical pathways through which the policy enhances energy productivity. This study presents empirical evidence on how effective market-based regulatory mechanism are in the energy sector and offers practical policy recommendations for integrating innovation-driven strategies within national carbon mitigation frameworks. |
| Keywords: | Energy Quota Trading System; Energy Productivity; Natural-Experiment Modeling; Green Technology Innovation; Energy Transition |
| JEL: | O13 O47 Q43 R11 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:yon:wpaper:2025rwp-258 |
| By: | Sanjeev Gupta (Center for Global Development); João Tovar Jalles (University of Lisbon-Lisbon School of Economics and Management (ISEG); Universidade de LisboaISEG; Universidade Nova de Lisboa-Nova School of Business and Economics IPAG Business School); Ainhoa Petri-Hidalgo (Center for Global Development) |
| Abstract: | Noncommunicable diseases—driven by tobacco use, harmful alcohol consumption, and high-sugar diets—account for over 70 percent of global deaths and impose annual economic losses exceeding US $514 billion. Excise taxes on these health-harming products offer a dual benefit of reducing consumption and raising public revenue, yet performance varies widely across countries. This paper applies stochastic frontier analysis to a global panel of 97 IMF member states to estimate maximal feasible excise tax performance for tobacco, beer, spirits, and sugar-sweetened beverages (SSBs), conditioning on GDP per capita, consumption patterns, demographics, and governance indicators. Given data availability, we estimate a revenue-based frontier for tobacco and rate-based frontiers (expressed as a share of retail price) for alcohol and SSBs. Tax-effort scores reveal that countries collect on average just 0.4 percent of GDP in tobacco excise revenue—despite a feasible capacity of 1.5 percent—indicating an untapped fiscal gap of 1.1 percent of GDP. For beer, spirits, and SSBs, countries apply only 35 percent, 25 percent, and 15 percent, respectively, of their feasible excise rates. We introduce a four-quadrant diagnostic framework to classify countries by tax collection and effort and identify tailored policy responses. These findings have major implications for health financing, fiscal reform, and technical assistance, particularly in low- and middle-income countries. |
| Keywords: | sin taxes, stochastic frontier analysis, tax capacity, excise revenue, health-tax efficiency |
| JEL: | H2 I1 H71 D61 C23 |
| Date: | 2025–09–15 |
| URL: | https://d.repec.org/n?u=RePEc:cgd:wpaper:727 |
| By: | Tino, Stephen |
| Abstract: | This paper examines the importance of labor market power and firm productivity for understanding the immigrant-native pay gap. Using matched employer-employee data from Canada, I estimate a wage-posting model that incorporates two-sided heterogeneity and strategic interactions in wage setting. In the model, firms mark down wages below the marginal revenue product of labor (MRPL), and the equilibrium immigrantnative pay gap arises from differences in wage markdowns and MRPL. The findings suggest that immigrants earn 77% of their MRPL on average, compared to 84% for natives. I also decompose the immigrant-native pay gap using counterfactual exercises that account for general equilibrium responses of workers and firms. The results of the counterfactuals suggest that (i) differences in labor supply curves contribute significantly to earnings inequality between immigrants and natives; (ii) immigrants tend to work at more productive firms, driven by their tendency to work in cities where firms are more productive on average; and (iii) heterogeneity in firm productivity magnifies the contribution of labor supply differences to the immigrant-native pay gap, highlighting the importance of interaction effects. |
| Keywords: | Immigration, inequality, monopsony, firm productivity, immigrant-native earnings differential |
| JEL: | J01 J15 J23 J31 J42 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:clefwp:327118 |
| By: | Diao, Xinshen; Jones, Eleanor; Pauw, Karl; Thurlow, James; Xu, Wenqian |
| Abstract: | Agricultural transformation, in broad terms, is the process during which the agricultural sector develops from a low-productivity, subsistence-oriented sector to a modern, commercially oriented one. It typically involves adopting advanced technologies and more sustainable and efficient production practices, and results in higher agricultural productivity per worker, agricultural diversification into high-value crops, and rising rural incomes. Importantly, agricultural transformation is also seen as a catalyst for broader economic development and a structural shift towards industrialization in developing economies. Given the central role of agricultural transformation in driving such change, as well as its contribution to development objectives such as poverty reduction, improvements in diet quality, and environmental sustainability, it is useful to measure and monitor progress on agricultural transformation. This is the purpose of the Agricultural Transformation Index (ATI), a newly developed composite index constructed from four indicators of progress on agricultural transformation: staple crop productivity, crop diversification, agricultural labor productivity, and food system expansion. Together, these indicators, which are calculated from publicly available, global datasets, can be used to examine progress over time on global, regional, and national scales. In addition to being transparent and easy to interpret, the index can be updated annually as new data is released. As demonstrated in this study, the ATI produces a plausible ranking of countries and is highly correlated with indicators of overall economic wellbeing such as GDP per capita or household-specific welfare measures such as poverty or the prevalence of undernourishment. The ATI is not only useful for identifying countries in need of support from international development partners or tracking their progress on agricultural transformation but can also highlight specific areas of agricultural transformation where technical or investment support might be directed by governments or their partners. |
| Keywords: | agricultural transformation; economic development; productivity; structural adjustment |
| Date: | 2024–09–17 |
| URL: | https://d.repec.org/n?u=RePEc:fpr:ifprid:152282 |