Estimation Of Production Function Research Articles

Thin subsidies effects on food consumption pattern and nutritional status of poor Brazilian children

This paper aims to analyze the thin subsidies effect on nutritional status and individual food acquisition for individuals in poverty between 2 and 9 years old. With the data of a Brazilian family budget survey, I estimated a model that identifies the individual consumption of calories, based on aggregate household consumption, followed by the estimation of a child health production function, which verifies the effect of a set of variables on Body Mass Index (BMI). Finally, I estimated the children's food demand system for various food categories (healthy and unhealthy). I found that the implementation of thin subsidies can be effective for the variability of healthy food destined to children, contributing significantly to the joint increase in food consumption that reduced prices (fruits, vegetables, fish and milk). However, only the variation in the amount of fruit suffers a variation that is more than proportional to the 20% variation in the price of the selected basket. The discount increases unhealthy food consumption (ultraprocessed and soft drinks) due to the complementarity relationship. Thereby, the combined discount granted to a healthy food basket increases the average total caloric intake. This intervention does not reverse the process of average BMI growth of economically vulnerable children and, consequently, it could not reduce the incidence of childhood obesity. In general, the analysis proposed was essential to understand how specific policy interventions can encourage healthy habits, giving attention to their impacts on vulnerable individuals. Children nutritional status. Children food demand system. Thin subsidies.

Impact of information technology on firm performance: New evidence from Indian manufacturing

India has risen to prominence as a global supplier of information technology (IT). However, the extent to which IT benefits Indian manufacturing is less well known. We assess the effects of IT capital on firm's growth from 1998 to 2016. We make two significant contributions: (i) we make comparisons between different periods, high-IT intensive and low-IT intensive sectors and 14 manufacturing industries at a disaggregated-level, (ii) to overcome the problems of simultaneity in production function estimation, we employ a recently developed semi-parametric technique. Our findings indicate that (i) IT as a production input contributes significantly to firm's output, yet the estimated effects vary significantly by time-period and industry, (ii) the impact of IT is maximum between 2000 and 2009, and then begins to weaken between 2010 and 2016, (iii) IT elasticities in high- and low-technology sectors appear to be converging, particularly between 2010 and 2016.

Gender Differential in Productivity and Income of Haricot Bean in Misrak Badawacho District of Southern Ethiopia

This study investigates gender differential in agricultural productivity, highlights its key determinants, and estimated the gap in income generated from the production of haricot bean. The study was conducted based on data generated from 122 male headed and 39 female headed households from Misrak Badawacho district of southern Ethiopia. Descriptive and inferential statistics as well as econometric models were employed to analyze the data. The models used were Cobb-Douglas production function, and output decomposition model. The estimates of Cobb-Douglas production function showed that fertilizer, improved seed, pesticide, labor, total land size, project participation, number of extension contact,Tropical livestock unit and distance from development agent center were significantly affect productivity of haricot bean. The estimate of decomposition model found that farm income differences between male and female headed household was 311 birr. Based on the result of the study it can be recommended that enhancing access to resource endowment and institutional support is critical inincreasing the productivity and income of female headed households in the study area. Keywords: Differential,Gender, productivity, household. DOI: 10.7176/JESD/13-11-05 Publication date: June 30 th 2022

Dependence modeling in stochastic frontier analysis

Abstract This review covers several of the core methodological and empirical developments surrounding stochastic frontier models that incorporate various new forms of dependence. Such models apply naturally to panels where cross-sectional observations on firm productivity correlate over time, but also in situations where various components of the error structure correlate between each other and with input variables. Ignoring such dependence patterns is known to lead to severe biases in the estimates of production functions and to incorrect inference.

Total Factor Productivity Calculation of the Indonesian Micro and Small Scale Manufacturing Industry

The purpose of this research is to determine the total factor productivity (TFP) of Indonesia's micro and small-scale manufacturing industries. The production function estimation approach established by Levinsohn-Petrin as the basis for computing TFP is employed in this study, with value added as the dependent variable and the value of labor costs and capital value proxied by the value of investment as the independent variables. This study uses secondary data from the Central Statistics Agency (BPS), which includes 23 sub-sectors of Indonesia's micro and small scale manufacturing industries that are included in the 2-digit ISIC, with the exception of the ISIC code 19 sub-sector, and covers the years 2010 to 2019, excluding 2016. The TFP value in the micro-scale Indonesian manufacturing industry was often higher than the TFP value on the small scale, according to this study. This research also demonstrates that low-tech sub-sectors, such as the food processing industry, have low productivity. On a small size, the estimated TFP value shows a decreasing trend, but on a micro scale, the estimated TFP value indicates an increasing trend.

Total Factor Productivity Calculation of The Indonesian Micro and Small Scale Manufacturing Industry

The purpose of this research is to determine the total factor productivity (TFP) of Indonesia's micro and small-scale manufacturing industries. The production function estimation approach established by Levinsohn-Petrin as the basis for computing TFP is employed in this study, with value added as the dependent variable and the value of labor costs and capital value proxied by the value of investment as the independent variables. This study uses secondary data from the Central Statistics Agency (BPS), which includes 23 sub-sectors of Indonesia's micro and small scale manufacturing industries that are included in the 2-digit ISIC, with the exception of the ISIC code 19 sub-sector, and covers the years 2010 to 2019, excluding 2016. The TFP value in the micro-scale Indonesian manufacturing industry was often higher than the TFP value on the small scale, according to this study. This research also demonstrates that low-tech sub-sectors, such as the food processing industry, have low productivity. On a small size, the estimated TFP value shows a decreasing trend, but on a micro scale, the estimated TFP value indicates an increasing trend.

Does an Empirical Economic Relation Have a Life?

Does an Empirical Economic Relation Have a Life?

Convex non-parametric least squares, causal structures and productivity

In this paper we consider Convex Nonparametric Least Squares (CNLS) when productivity is introduced. In modern treatments of production function estimation, the issue has gained great importance as when productivity shocks are known to the producers, input choices are endogenous and estimators of production function parameters become inconsistent. As CNLS has excellent properties in terms of approximating arbitrary monotone concave functions, we use it, along with flexible formulations of productivity, to estimate inefficiency and productivity growth in Chilean manufacturing plants. Inefficiency and productivity dynamics are explored in some detail along with marginal effects of contextual variables on productivity growth, inputs, and output. Additionally, we examine the causal structure between inefficiency and productivity as well as model validity based on a causal deconfounding approach. Unlike the Cobb-Douglas and translog production functions, the CNLS system is found to admit a causal interpretation.

Potential growth in Turkey: Sources and trends

This paper estimates potential growth in Turkey using a production function estimation approach. Our approach aims to measure the inputs of production in the most detailed fashion that is possible and empirically addresses concepts of sustainable potential growth for Turkey. While developing measures of the sources of potential growth, we provide a thorough discussion of the estimated trends in labor force participation, capital growth by asset type, and total factor productivity since the mid-2000s. Our results suggest that the key driver of potential growth has increasingly been capital accumulation. The declining trend in the positive TFP growth stands out as the key area of improvement for potential growth.

Impact of foreign ownership on firm productivity: evidence from Japanese manufacturing firms

This article presents the methodology to examine the impact of foreign ownership on firm productivity using firm-level data of Japanese manufacturing firms from 2000 to 2016, which include 1,458 listed companies in Japan. Firm productivity is represented by total factor productivity (TFP), which is estimated by the Olley–Pakes semiparametric estimation method to minimize the simultaneity problem in production function estimation. In the estimation of the impact of foreign ownership on firm productivity, system GMM estimation is applied to address a possible reversal causality problem between foreign ownership and firm productivity. Based on the case of the manufacturing firms in Japan, this article shows that 1 percentage point increase in foreign ownership increases the firm productivity by 0.06 percent. The evidence of this article supports the positive impact of foreign ownership on firm productivity and further implies that the promotion of foreign investment could be a policy option to improve firm productivity. Highlights This study analyzes the impact of foreign ownership on firm productivity. Firm-level data of the Japanese manufacturing firms from 2000 to 2016 are analyzed. The result supports the positive impact of foreign ownership on firm productivity.

An augmented Lagrangian method with constraint generation for shape-constrained convex regression problems

Shape-constrained convex regression problem deals with fitting a convex function to the observed data, where additional constraints are imposed, such as component-wise monotonicity and uniform Lipschitz continuity. This paper provides a unified framework for computing the least squares estimator of a multivariate shape-constrained convex regression function in $${\mathbb {R}}^d$$ . We prove that the least squares estimator is computable via solving an essentially constrained convex quadratic programming (QP) problem with $$(d+1)n$$ variables, $$n(n-1)$$ linear inequality constraints and n possibly non-polyhedral inequality constraints, where n is the number of data points. To efficiently solve the generally very large-scale convex QP, we design a proximal augmented Lagrangian method (proxALM) whose subproblems are solved by the semismooth Newton method. To further accelerate the computation when n is huge, we design a practical implementation of the constraint generation method such that each reduced problem is efficiently solved by our proposed proxALM. Comprehensive numerical experiments, including those in the pricing of basket options and estimation of production functions in economics, demonstrate that our proposed proxALM outperforms the state-of-the-art algorithms, and the proposed acceleration technique further shortens the computation time by a large margin.

An Estimation of Dates Production Function in Karbala Governorate For The Agricultural Season 2020 (Al-jadual Al-gharby District A case Study)

This study aimed to detect the most important factor that affects dates production. About 108 questionary forms collecttted palm orchard farmers in Karbala to estimate the dates production function in Karbala governorate for the agricultural season 2021 (the district of Al-jadual Al-Gharby). The study distributed those formmmsss for about 10% of the total palm orchards in Al-jadual Al-Gharby district of the holy governorate of Karbala. The study used the method of ordinary Least squares (OLS) to estimate the mathematical model of the function. The results showed that the double Logarithmic function in terms of its estimation of the estimated Coefficients by one unit leads to a corresponding change in the produced quality of dates and the same direction by 0.188 0.808) % respectively, and that the capital variable is more in fluently in production than the work variable. As for the total production elasticity (the sum of the partial elasticities of the resources used), which represents returns to scale, it amounted to about (0.996), which indicates a decrease in the return to scale.

How the breadth and depth of import relationships affect the performance of Canadian manufacturers

AbstractThis paper examines the relationship between a manufacturing firm's import behaviour and its performance. The focus is on two aspects of imports, input variety and the dynamics of import relationships. Using identification conditions borrowed from the production function estimation literature, we show that firms importing more products from a larger set of suppliers tend to be larger, more productive and more successful in export markets. Not only does the number of supply relationships matter but also the duration. Firms maintaining a higher share of continuous supply relationships also benefit from size and productivity effects. These results suggest that the breadth and depth of the import network are relevant factors for the performance of Canadian manufacturers, underscoring the importance of pursuing trade liberalizations with new partners and trade facilitation with established sources of suppliers.

Common Policy but Different Outcomes: Structural Change in Family Farms of Central and East European Countries after Their Accession to the EU

This paper investigates structural change in family farming in ten EU New Member States from Central and Eastern Europe which can be treated as a borderline between transition and developed economies. The paper proposes that farms using at least one Annual Work Unit (AWU) family labour are classified as family since it is considered that engaging less than one full-time family member may not show commitment to the family operation. The Oaxaca-Blinder decomposition is employed to analyse the drivers of structural change at a farm level, i.e., the extent to which it is technology or endowment driven. To compare the developments in different countries, the changes are presented in relative terms in order to reveal the relative distance travelled by the structural change in individual New Member States alongside the relative importance of technology and endowments changes. The estimation of a translog production function by country is used to derive the corresponding decompositions. Empirical analysis is based on data from the EU Farm Accountancy Data Network (FADN) for two time points—2007, when the last of the ten CEECs joined the EU—Bulgaria and Romania, and 2015 to investigate structural change during the first decade of EU membership. The results show that the differences in the initial conditions and the adjustments to the CAP have brought about quite a diverse picture concerning the changes in output in the family and non-family farms in the NMS. The a priori expected dynamics of positive output growth in family farms and negative in the non-family has only materialised in Latvia, Romania and Slovakia. The decomposition of output changes suggests a positive effect of technical change in family farms only in the early years of EU accession. Concerning endowments, their effect on structural change is mostly positive with the only exception of Slovenia. This suggests that the family farming sector grows by accumulating productive resources. However, this growth has not always materialised in increase of family farms output.

​Factors Affecting Production of Important Pulse Crops in Rajasthan: A Cobb Douglas Analysis

Background: Pulses are one of the most important food crops grown globally owed to their higher protein content. It also accounts for larger financial gains of the agricultural sector by amounting for a large part of the exports. The present study was carried out to determine the factors affecting production of pulse crops in Rajasthan. Methods: This paper based on secondary data collected over the years i.e. from 2000-01 to 2017-18. The Cobb-douglas production function was used to the observation for the estimation of elasticity of selected variables contributing to the production of pulses in Rajasthan state, Cobb douglas type production function was employed to assess the effects of seed, fertilizer, manure, human labour, irrigation, bullock labour and plant protection measures on pulses production. Result: The results from the study have shown that fertilizer and plant protection measures were positively significant while the variable corresponding to irrigation water was negatively significantly affecting the gram production. The variables such as seed and irrigation water were found positive and significant, while plant protection measures had significant negative effect on black gram production. Only two variables namely, fertilizer and irrigation water were found positively significant out of estimating production function of green gram.

Do technological investments promote manufacturing productivity? A firm-level analysis for India

This paper assesses the effects of firms' investments in Information Technology (IT) and Research and Development (R&D) on their productivity growth. Unlike prior studies, our models examine individual as well as combined effects of these investments. We employ recently developed methods to control for transmission bias in production function estimation. For analysis, we utilise a panel of 900 manufacturing firms in India during 2000–2016. Our results show that (i) firms in high-technology industries are more productive than those in low-technology industries (ii) combined use of IT and R&D inputs yields higher productivity growth (iii) export-oriented firms are more technology-intensive and more productive than non-exporting firms (iv) exporting firms' productivity gains from IT investment are higher by around 0.03–0.04 percentage-points compared to non-exporting firms’

Estimating production functions using energy to control for unobserved utilization

The recent production function estimators may overestimate or underestimate productivity growth due to ignoring the measurement errors caused by overcapacity. We extend the estimation procedure proposed by Ackerberg et al. (2015) by using energy to control for unobserved factor utilization.

Measuring the effects of prenatal care on child birth weight in Cameroon.

Low birth weight continues to be a significant public health problem worldwide with a range of short- and long-term consequences. However, the analysis of its determinants remains a less addressed issue in sub-Saharan African countries despite the poor child health indicators observed there. The objective of this study is to examine the effects of prenatal care on child birth weight in Cameroon, using data from the fifth Demographic and Health Survey. For this purpose, we use a system of simultaneous equations that takes into account potential endogeneity and sample selection bias. Two measures of prenatal care are used in this study, namely, adequacy and quality. Estimation of the birth weight production function using the instrumental variable two-stage least square approach reveals that adequate prenatal care increases the child's birth weight by 882.84 g. Also an increase in the quality of prenatal care by one unit improves the child's birth weight by 147.79 g. Thus, despite the fact that prenatal care in Cameroon suffers from some shortcomings as regards to the standards recommended by the World Health Organization, it remains a key factor for the improvement of neonatal health outcomes in this country.

Jeff E. Biddle, Progress Through Regression: The Life Story of the Empirical Cobb-Douglas Production Function

Many economists invoke the term “Cobb-Douglas” frequently, while knowing little of its history. In 1927, Paul H. Douglas presented his results on an estimated production function in a paper at the American Economic Association annual meeting. This was joint work with the mathematician Charles W. Cobb. What became known as the Cobb-Douglas production function was not new—Knut Wicksell had previously suggested it—but its estimation using time-series data marked the beginning of a new literature...

Estimating the Production Function Under Input Market Frictions

Abstract Behind many production function estimators lies a crucial assumption that the firm's choice of intermediate inputs depends only on observed choices of other inputs and on unobserved productivity. This assumption fails when market frictions distort the firm's input choices. I derive a test for the assumption, which is rejected in several industries. Using weak identification asymptotics, I show that when the assumption fails, a simplified dynamic panel estimator can be used instead of choice-based methods because it requires choices to be distorted. I propose criteria for choosing between estimators, which in simulations yield lower error than either estimator alone.