Low Labor Productivity Research Articles

Nonparametric economic analysis of the level of technical efficiency of cattle meat production in the Krasnodar Krai in 2013-2018

Calculations of estimates of the technical efficiency of production activities of agricultural organizations of the Krasnodar Krai that produce live weight gains of cattle in 2018 were performed. For this purpose, a nonparametric method is used, which compares the actual and potentially possible maximum production volumes calculated using the linear programming method for each specific commodity producer in a representative sample of enterprises and forming a broken boundary production function. The size of the potential for growth in the production of meat cattle products based on the existing livestock in the region was determined and priority areas for its implementation was identified. It was established that the main factors hindering the development of meat cattle breeding in the Krasnodar Krai are low potential of biological productivity of the livestock breeds used, use of unbalanced feed rations that lead to a large overspend of certain types of feed, and low labor productivity.

The Influence of ICT Sector on the Romanian Labour Market in the European Context

The ICT sector, as the backbone of the fourth industrial revolution, has major implications for labour markets. Assessing its effect is crucial for the development of policies that support the labour markets, bringing many benefits for workers, organizations, the economy, and society as a whole. The purpose of this paper is to analyse the level of digitalization of the Romanian economy in the EU context, as well as the impact of the ICT sector on employment and skills. The results of the comparative analysis at the EU level show that there are significant negative gaps between Romania and the EU average, as well as between Romania and Visegrad countries, in terms of Digital Economy and Society Index (DESI), the contribution of ICT sector to employment and GDP, employed ICT specialists (as % of total employment) and the impact of ICT on tasks and skills. A strong positive correlation was identified between the level of digitalization of economy and society (expressed by DESI) and the labour productivity in the EU countries. Therefore, in order to reduce these negative gaps and to create an inclusive digital economy and society, a higher level of digitalization of work is required, especially in countries (like Romania) where there is a low level of digital economy, as well as low labour productivity. At the same time, it is essential that the EU labour force develops the necessary digital skills so that workers win the race of digitalization of jobs.

Structural-dynamic features of population employment in Ukraine service industry sphere

The structural-dynamic peculiarities of employment in the service industry are investigated. The facts that the service industry plays an increasing role in the economic growth of the countries and that the share of employed in the service industry in the countries with the developed market economy is 75–80% are emphasized. Therefore, Ukrainian economy has significant capacity for the employment increase in this industry. It is determined that the high share of employed in industries requiring highly skilled personnel indicates the development of innovative-technological economy sectors. It will promote the country’s GDP growth in future. The share of employment in such industries is defined to remain insignificant in Ukraine, as typical for to the countries with transition economies. The structure of employment in the service industry sectors in Ukraine and developed countries is determined to be distinctly different, although it provides Ukraine with additional opportunities to develop competitive sectors of service industry. It is revealed that the average weighted rate of employment growth has declined in 2018 in comparison with 2013 (81.59%), which is peculiar to the Ukrainian economy in general, where the 80.18 employment growth for the same period was caused by decline of economic activity in the country and was related to the unstable political situation and military actions, substantial inflation, declining foreign direct investment, etc. The formation of employment structure in service industry is influenced by transformation processes characteristic for the countries with transition economies. The evidence of effective development of service indusrtry is the growth of labor productivity. The significant share of employment in the region's service industry, along with low labour productivity, indicates the substantial shadowing of employment. In Ukraine, the level of informal employment is the highest in trade, transport and temporary accommodation sectors. At the same time, the growing share of employed in the industries with high added value like ICT, finances, healthcare, administrative and support services, scientific and professional activity, etc. indicates the efficient structural transformation of Ukrainian economy.

Production organization capacity of ethnic minorities in northwestern region of Vietnam

Survey results of 1,452 people representing families of 6 ethnic minorities in 11 communes of 7 districts in 7 provinces in the Northwest region shows that the production organization capacity of the ethnic minorities surveyed has changed, but still remains many limitations. The change in production capacity of ethnic minorities is reflected in the fact that the majority of families have produced in a new way (know how to use some machines, use new plant varieties and breeds, apply chemical fertilizers, use pesticides, and some agricultural products produced for sale). The limitations of the production organization capacity of ethnic minority families are shifting cultivation, dibbling, rudimentary production tools, low labor productivity, production by small-scale, autarky, shifting cultivation of wandering hilltribes). If comparing between traditional production method and new production method, the traditional production method is still more prevalent. One of the main causes of this situation is that ethnic minorities live in mountainous areas with difficult transportation, so the main cultivation method is shifting cultivation. The application of machines in production faces many difficulties.

Economic Costs of Climate Change

We estimate the economic impact of climate change by exploiting variation in local temperature across suppliers of the same client. We find that suppliers experiencing a 1°C increase in average daily temperature decrease their sales by 2%. The effect is more pronounced among suppliers in manufacturing and heat-sensitive industries, which is consistent with lower labor productivity and supply when temperatures are higher. Financially constrained suppliers are more affected due to their lack of financial flexibility to adapt to changes in temperatures. We also find that episodes of extremely hot and cold weather lead to large drops in sales.

Finance, Property Rights and Productivity in Italian Cooperatives

Standard economic theory predicts that the accumulation of capital by means of indivisible reserves would lead to underinvestment and undercapitalization due to the truncated temporal horizon of worker-members in cooperatives (the so-called “Furubotn-Pejovich effect”). An inefficiently low stock of capital would imply, other conditions being equal, lower labour productivity. We test the real effects of collective capital on productivity using a large panel of Italian worker and social cooperatives. Firm-level balance sheet data from Bureau van Dijk Aida database are used to estimate the effects of collective and individual reserves of capital on total factor productivity using an augmented Cobb-Douglas production function. Social security data on employment contracts in all Italian enterprises are used to measure firm-level full-time worker equivalents employment. Collective ownership and total factor productivity are positively and significantly related after controlling for factor productivity, individual capital ownership and other standard firm-level and sectoral controls. This result is robust to different specifications of the model and suggests a positive role of collective capital in strengthening financial sustainability, patrimonial and employment stability in the long run, favouring also firm specific investments.

Toward sustainable intensification of agriculture in sub-Saharan Africa

Across the African continent efforts to intensify agriculture have been limited to specific commodities, locations or particular production schemes. The causes for the widespread failure to overcome low land and labor productivity while maintaining ecosystem services have often be analyzed but remain poorly understood. A social-ecological system approach may help to better understand the complex nature of ecological disadvantages, postcolonial structures, limited connect between producers and consumer markets, low off-farm livelihood opportunities, partial underpopulation and lacking experience with the concept of sustainable production as a major impediment for sustainable intensification of the agricultural sector. Nevertheless, recent success stories in agro-pastoral systems as well as urban vegetable and animal production and associated value chains in West Africa, and in intensive mixed-cropping systems of the Great Lakes Region show the potential of stakeholder-driven agricultural intensification. Proper interpretation of these cases may provide lessons for a more widespread eco-intensification of smallholder agriculture in sub-Saharan Africa.

ТЕОРЕТИКО-МЕТОДОЛОГИЧЕСКИЕ АСПЕКТЫ ИНВЕСТИРОВАНИЯ В СЕЛЬСКОМ ХОЗЯЙСТВЕ

Despite the continued growth of agricultural production and increase the share of Russian exports on world markets of agricultural products, today the agrarian sector of Russia there are such negative features as: moral and physical deterioration of capital facilities, low capital productivity and labor productivity, falling profitability of production in some sectors of agriculture. In this regard, the issues of attracting foreign investment to the industry, stimulating investment in updating the material and technical base, and improving the state investment policy become particularly relevant. The theoretical and methodological aspects of the formation of investment resources by agricultural entities and the factors that determine the features of investment activities in agricultural production require additional consideration.

Approaches to Assessing the Strategic Sustainability of Large, Medium, and Small Enterprises in the Depressed Regions of Russia

The presented study examines the results of the assessment of the strategic sustainability of the complex of large, medium, and small enterprises in Russian regions. The specific features and parameters of the complex of enterprises in the depressed regions of the Russian Federation are identified. The hypothesis about the dependence of the economic indicators of regional development on the strategic sustainability of enterprises operating in the region is confirmed. Directions for applying the results of this study to boost the economies of the depressed Russian regions by improving the management of the complex of enterprises are proposed. Aim. The study aims to analyze the methodological approaches to assessment proposed by the authors as well as the strategic sustainability of large, medium, and small enterprises in the depressed regions of Russia.Tasks. The authors develop a methodology for analyzing the strategic sustainability of the complex of large, medium, and small enterprises in Russian regions as a crucial factor of regional economic growth; identify specific features in the development of this complex in the depressed regions of Russia by calculating an integrated index for performance assessment – index of strategic sustainability of the complex of enterprises in the region; determine the sustainability parameters of the complex of enterprises in the constituent entities of the Russian Federation based on the developed system of indicators. According to the results of the study, the authors characterize directions for improving the management of the complex of large, medium, and small enterprises.Methods. The theoretical and methodological basis of the study comprises theories and concepts of the role of enterprises and entrepreneurship in regional economic development, allowing the authors to propose definitions for the concepts of ‘strategic sustainability of the complex of enterprises in the region’ and ‘regional profit center’. This study also uses general scientific methods: analysis and synthesis, comparative and statistical analysis, systematization, calculation of an integrated index, cluster analysis, and correlation analysis. The calculations are based on the data of the Russian Federal State Statistics Service, Russian Federal Tax Service, and SPARK database by Interfax.Results. The study shows that the complex of enterprises in depressive regions is not strategically stable. In comparison with regions where the socio-economic development rate is higher, the depressed regions of the Russian Federation have a significantly lower proportion of large business enterprises, lower labor productivity and innovative activity of enterprises, less favorable demography of enterprises, much lower share and growth rate of corporate income taxes in the total tax revenues of the region, and other indicators pertaining to the analysis of activity of enterprises. This confirms the hypothesis of the dependence of regional economic development on the business structure of the region and makes it possible to propose ways of improving the management of strategic sustainability of enterprises in depressed regions for federal and regional authorities.Conclusions. The complex of large, medium, and small enterprises in depressed regions is characterized by low and extremely low sustainability parameters, which affects the economic and social development of the regions. Many key indicators of the development of depressed regions over the past 30 years have values below 50 % of the average level in Russia. Improvement of the management of development of depressed regions should focus on enhancing government support tools that facilitate the development of the complex of enterprises in the regions. The management of sustainability of the complex of enterprises in a region should be integrated into the strategic management system at the federal and regional level.

The effects of employment policy measures on the labour demand of persons with changed working abilities

Abstract Based on the methods used by economic theory, the study analyses the labour demand of companies and pays special attention to people with changed working ability. The European Union emphasizes the development of active employment policy programmes in line with the wide range of benefits linked to additional labour force utilization in our country. Tax liabilities and tax allowances related to additional labour force utilization significantly affect the profitability of companies. For this reason, the study examines the effects of the use of the production factor in certain cases on the profit based on the example of a 25-person company. Despite active employment policy measures, experience shows that the labour demand of companies is less directed towards people with changed working abilities. However, in this situation, besides the estimated lower labour productivity, infrastructural and sociological factors also play an important role.

Introducing labour productivity analysis in a co-innovation process to improve sustainability in mixed family farming

Mixed family farms produce almost half of the world food. Increasing food supply in developing countries requires increasing productivity of both land and farmers’ labour as key to increase household income, food security and reduce poverty. A research project developed into Uruguayan vegetable family farms (2006–2010) revealed that the main life quality problems were low family income, high work overload, lack of leisure time, and health problems associated with work. In many of these farms, labour productivity was lower than the opportunity cost of labour. Understanding labour productivity determinants would help to guide co-innovation processes of family farm systems. The objective of this study was to develop and apply a method to analyze labour productivity (LP) at farm level, identifying the main causes of low LP, to use its results in a co-innovation process. We selected 14 vegetable-beef cattle farms with different resource endowment. The method developed involved characterization and quantification of labour allocation to farm activities, calculation of technical coefficients that explained LP and quantification of improvement scenarios. The first scenario estimated the impact of farm redesign plans and the second one added the effect of mechanizing some tasks. LP was lower than the opportunity cost of labour (4 USD h−1) in 10 out of 14 farms. LP in vegetable production (LPv) was explained by both, net return (NR, $ kg−1) and labour efficiency (LE, kg h−1). LE correlated with the amount of product sold (APS, kg of vegetables or meet per year). LP in beef cattle production (LPb) was lower than LPv. LPb was higher on farms with more than 80 cattle units (CU) and 60ha due to lower labour per ha and per CU showing a scale effect. Projected scenarios showed that LP could be tripled by improving resource allocation, and crop and animals management. Mechanizing some labour consuming tasks could further increase LP by 12 %. This study contributes to co-innovation methodology development by adding labour productivity analysis at diagnosis stage and using the results to aid participatory development of applicable and appropriate strategies to increase family farm systems sustainability.

Sustainable Marine Economic Development in Vietnam in the Period 2011-2018

This work is to test the hypothesis of sustainable economic development by using a linear structural model. The structural equations in the structural model show that, the social development goals depend on economic growth and environmental protection goals, namely (Social target) = 1.22 * (Economic target) - 0.064 * (Environment target) and economic development target depend on social development goals and environmental protection goals, namely (Economy target) = 1.35 * (Social target) - 0.039 * (Environment target). The result show that both economic and social development have an adverse environmental impact that will no longer harmonize goals, reflecting the unsustainable marine economic development in the period of 2011-2018. There have many factors of unsustainable marine economic development in period 2011-2018, but mainly is low economic growth efficiency, low labor productivity and the process of urbanization does not truly create a foundation for economic development.

INNOVATIVE ECONOMY AS A FACTOR OF SUSTAINABLE DEVELOPMENT OF RURAL TERRITORIES OF KAZAKHSTAN

The rural economy of Kazakhstan experienced a structural crisis caused by a break in the inter-industry ties necessary for balanced and sustainable development, which was accompanied by an imbalance between the production of important types of products and their needs. The key task of the state policy of Kazakhstan is the revival of the countryside, the solution of which is carried out on the basis of improving the development policy of rural territories, searching for new ideas and directions for the qualitative development of the countryside. Along with this, there are factors hindering the achievement of sustainable development of rural territories, among which there is a persistent low labor productivity and insufficient level of economic efficiency of production activities.

NETWORK ORGANIZATIONAL STRUCTURES OF PRODUCTION OF HIGH-TECH PRODUCTS AS A TOOL OF TECHNOLOGICAL BREAKTHROUGH IN RUSSIA

The paper deals with the problems of reforming the organization of the production of high-tech products in Russia. A comparative analysis of the state and significance of these industries in the economies of developed countries and Russia shows the need for reforming the structural organization of production. On the example of the aviation industry, an analysis of the improvement of industrial production was carried out. Evaluation of the effectiveness of relevant measures shows that they contribute to the conservation of closed obsolete business-production models, monopolization of the final integrator in accessing and using investments, low labor productivity and outflow of personnel, lack of effective interaction of the scientific and technological sector with domestic academic university science. This impedes the formation of the competencies necessary to carry out a technological breakthrough and increase the competitiveness of the industry in the global market.The paper presents a model of vertical integration of the technological chain of value added reproduction in the form of network organizational structures of suppliers of modules, units and nodes of the final complex technology based on domestic manufacturers. The paper discusses the benefits of the heliocentric organization of the production of the final complex technology, the cluster organization of the supply of intermediate products (modules, units, nodes). It is shown that the separation of the functions of the final integrator contributes to the distribution of risks along the DVCS. At the same time, the attention of the final integrator is concentrated on the development of the final complex products, the organization of the supplier system and after-sales service. The cluster organization of intermediate production opens up the possibility of its diversification and direct access to investment flows, which stimulates the development of production. The authors have developed mechanisms for ensuring the competence of manufacturers to their functional purposes in the central air traffic control system and the organization of a network management system.

Управління забезпеченням економічної безпеки регіональної філії АТ «Українська залізниця»

Ukrainian railway transport makes significant impact on the economy of Ukraine (56,1% of freight turnover and 27,4% of passenger traffic in 2018), as well as on such important components of its national security as economic security, political security, social security, military security and others. JSC «Ukrainian Railways» includes 6 regional affiliates (Southern Railway, Lviv railway and others), which are not legal entities, but have their own management systems and resourses.The scheme of the economic security system for a regional affiliate of JSC «Ukrainian Railways» is developed in the paper (according to the black box model). Its inputs are: Threats to the economic security of JSC «Ukrainian Railways» (external and internal); Resources for economic security provision (personnel, financial, material, informational, etc). Its outputs are: an acceptable level of economic security of a regional affiliate (not lower than 0,80); sustainable development of a regional affiliate. Inside subsystems are named after 7 functional components of economic security provision: financial; intellectual and personnel; technical and technological; political and legal; informational; ecological; power.The control subsystem of the scheme of the economic security system must include: a unit of diagnostics of level of economic security; a threat monitoring unit; a unit of organization, planning, motivation and control. The functions of the units are described in the paper. It is also revealed what functional components of the economic security of JSC UZ and its affiliates are affected by major internal threats. The main internal threats are corruption, unprofessional leadership, the loss of skilled workers, the progressive depreciation of fixed assets and the distortion of reporting.The calculations of the level of economic security of the regional affiliate «Southern Railway» in 2014 - 2018 are performed and the reasons for being it in the risk zone are revealed. They are: low labour productivity, reduction of current liquidity and productivity of locomotive, low productivity of carriage, deepening of unprofitableness of activity of the railway (rate of return dropped to -27,4%).

New Technologies, Potential Unemployment and ‘Nescience Economy’ in the Russian Regions

The use of unmanned technologies can cause a decrease in the level of employment. The article discusses the compensation mechanisms and conflicting results of empirical studies. Using internationally comparable methods, we estimated that approximately 27.6% of employees work in professions with a high probability of automation (Frey, Osborne, 2017), and about 44% of the workers in Russia (≈20.2 million) are engaged in routine, potentially automated activities (Manyika et al, 2017). These values are lower than in most developed and developing countries, although we expected them higher because of much lower labour productivity in Russia. In the regions, specializing in the manufacturing industry, the second value is higher; the lowest proportion of workers are at risk of automation in the largest agglomerations with high share of digital economy and in the least developed regions with large informal sector. We proposed a methodology to take into account informal employment and constant unemployment rate. Long-term mismatch between the exponential increase in automation rate, the compensating effect of retraining and new jobs creation is possible. Some people will not be ready for a life-long learning, development of new ideas, technologies and products, competition with robots, and accordingly there is a possibility of their technological or even social exclusion in the future. The term ‘nescience economy’ was proposed to describe these processes. Using an econometric model, we identified factors that reduce these risks in the regions: a high concentration of human capital, favourable institutional conditions for entrepreneurship, a low level of inequality, and the development of ICT infrastructure.

ПРОДУКТИВНІСТЬ ПРАЦІ В УКРАЇНІ: МОТИВАЦІЙНИЙ АСПЕКТ

Аналізуються динаміка та основні чинники продуктивності праці в Україні. Досліджуються причини самовідтворення низьких стимулів до її підвищення як на рівні держави, так і на рівні окремих роботодавців та найманих працівників. Пропонуються зміни у вітчизняному інституційному середовищі як основної передумови формування мотиваційного механізму підвищення ефективності використання робочої сили.

Pakistan

Pakistan’s economy is at a critical juncture. Misaligned economic policies, including large fiscal deficits, loose monetary policy, and defense of an overvalued exchange rate, fueled consumption and short-term growth in recent years, but steadily eroded macroeconomic buffers, increased external and public debt, and depleted international reserves. Structural weaknesses remained largely unaddressed, including a chronically weak tax administration, a difficult business environment, inefficient and loss making SOEs, and low labor productivity amid a large informal economy. Without urgent policy action, economic and financial stability could be at risk, and growth prospects will be insufficient to meet the needs of a rapidly growing population.

The Impact of a Crisis on the Innovation Systems in Europe: Evidence from the CIS10 Innovation Survey

The varieties of the national innovation systems among European countries are reflected in the large differences, discrepancies and sometimes unexpected results in the innovation processes and their influence on labor productivity growth. The goal of this paper is to find the differences between the drivers of the innovation systems and their influence on growth of productivity between two groups of countries with different institutional settings in the period of the financial and economic crisis in Europe. The first group consists of a selection of CEE (Central and East European) countries. The second group consists of Germany, Norway, Spain and Portugal. In order to measure the role of innovation on productivity growth we use the CDM (Crépon, Duguet and Mairesse) model of simultaneous equations. The model directly links R&D engagement and intensity to innovation outcomes measured either as process or product innovation, and then estimates the effectiveness of the innovative effort leading to productivity gains. The company-level dataset is drawn from the Community Innovation Survey (CIS10). There is one common result for the two groups, that in general the probability for a typical firm to engage in innovation increases with its size. The other factors influencing the decision process differ. A firm’s productivity increases significantly with innovation output, but only with firms operating in Western Europe. The results for firms in Central and Eastern Europe indicate that these countries’ national innovation systems are vulnerable, and in periods of crises higher level of innovation output leads to lower labor productivity. Therefore, systemic faults in the national innovation systems result in their unsustainability, especially visible in periods of crises, as was the case in 2008–2010. When it comes to Western European countries, the financial and economic crisis did not have negative effects on their innovation systems as innovation activity resulted in higher levels of labor productivity. Regarding the CEE group of countries, the crisis influenced both the innovation process and labor productivity as a whole negatively.

Diversity and sustainability of pig farm types in the northern mountains of Vietnam.

Pig farming systems in Vietnam are very diverse but little is known about this diversity. In particular, the different livestock farming systems currently in operation do not have the same capacity to be sustainable. The study aims to categorize farming systems involving pig production and investigate their sustainability. Data were collected from 160 family pig farms and 2 large-scale farms in Mai Son district of Son La province (northwest of Vietnam) using stratified random sampling. The multiple factor analysis method was used to identify different farms and to characterize each type with economic, social, and environmental indicators. The results highlighted four different farm types. Type 1 contained smallholder farms with diversified farm activities. They were mainly farmed by ethnic minorities located in the intermediate highland. They had low labor productivity and relied mainly on crop farming. Pig production was characterized by a low level of economic and social sustainability. Type 2 farms had comparatively less land and crops than other types. They were more specialized in livestock production, had medium-size pig herds, and were engaged in off-farm jobs. They were less dependent on credit or location and performed better with regard to environmental issues than larger farm types. Type 3 was specialized farms with large pig herds. They seemed more sustainable in economic and social components than the other types, but their environmental sustainability was questionable. Type 4 contained large mixed crop-livestock farms. They obtained high income but were more dependent on credit than the other types. In the future, in addition to focusing on large-scale specialized farms, policies should also consider small-scale and diversified farms because of their role in the sustainable development of national pig production.