Evolution Of Total Factor Productivity Research Articles

Green finance: how can it help Chinese power enterprises transition towards carbon neutrality.

China's power sector must cut its carbon emissions by 90% by 2060 to become carbon neutral. Green finance, as a crucial link in sustainable development, is garnering attention for its role as a mechanism for the green transformation of power enterprises. The process of green transformation development is highly challenging and requires a lot of financial support. This paper discusses the design of schemes for fiscal and financial support mechanisms for the green transformation of power enterprises, financing mechanisms to strengthen green finance, and financial support mechanisms to promote carbon trading. The utilization of green finance by power enterprises is assessed after defining the impact routes of green finance on clean energy power firms and highly polluting power firms. Using the SBM-GML model with variable returns to scale, the dynamic change of the use efficiency of green finance in power enterprises is calculated. At the same time, the enterprises are classified by power generation methods, and the changes in the power generation structure of power enterprises are analyzed. Compared with 2014, the total power generation in 2021 increased by 59.14%, wind power generation increased by 170.78%, and photovoltaic power generation increased by 974.31%. Hydropower, by contrast, grew by 94.14% and thermal power by only 45.09%. The results show that the evolution of total factor productivity and green total factor productivity of the 24 listed electric power enterprises is "M" shaped, that the main cause of the fluctuation is the serious phenomenon of "Triple Abandonments" of wind, light, and water in China's power industry, and that the main means to improve total factor productivity and green total factor productivity of the power industry is to improve green power production technology. Classified by power generation mode, it is found that hybrid power generation enterprises have the highest average efficiency value, followed by wind power generation. China's power enterprises are still dominated by thermal power generation; before the "Double Carbon" target, green power generation enterprises have not significantly improved the efficiency of green finance. The series of green finance mechanisms of action described in this study have a beneficial impact on the green transition of energy, according to a predictive analysis that combines existing policy objectives and practical mechanisms. Even without green financial support, the composition of China's major clean energy sources will account for 86.85% of total electricity generation by 2060, while with green financial support, coal generation will fall to 0% around 2056, with hydroelectric, wind, and photovoltaic generation accounting for 11.81%, 50.00%, and 38.19% of electricity sources, respectively, and green finance will drive important technological changes, and the "Triple Abandonments" phenomenon will be fundamentally corrected. Finally, countermeasures and suggestions for the healthy development of green finance in power enterprises are proposed based on the findings of the study.

Spatial-Temporal Evolution of Total Factor Productivity in Logistics Industry of the Yangtze River Economic Belt, China

The logistics industry plays a great role in the sustainable economic development of the Yangtze River Economic Belt (YREB). This paper measures the total factor productivity (TFP) of the logistics industry by using the DEA-Malmquist index method and analyzes its spatial-temporal evolution characteristics based on panel data of 11 provinces and cities in the YREB in 2003–2017. Lastly, a spatial autocorrelation analysis was conducted in conjunction with the exploratory spatial data analysis (ESDA) model. The results show that the overall development of the logistics industry has been relatively good, with an inverted “N” shape trend over the years. Technological progress is the main reason for the growth of TFP. From a regional perspective, it shows a spatial distribution pattern of high in the east and low in the west, with an overall upward trend of TFP levels. The spatial correlation between the TFP levels of logistics in each province and city is gradually increasing, but coordinated development between regions is still limited. Finally, according to the conclusions, policy recommendations are proposed to accelerate the coordinated development of regional logistics and the innovative development of the modern logistics industry.

Spatial and temporal evolution of total factor productivity of low-carbon tourism industry based on DEA–Malmquist Index model

Abstract The energy consumption and carbon dioxide emissions of tourism industry in China have become issues that cannot be ignored, putting pressure on the natural environment. This study uses Data Envelopment Analysis–Malmquist Index (MI) model to analyze the temporal and spatial evolution process of low-carbon tourism industry efficiency in Heilongjiang Province from 2010 to 2019. The results show that from 2010 to 2019, the technical efficiency (TE) of low-carbon tourism industry in 12 regions of Heilongjiang Province was significantly different and shows a growth trend. The pure technical efficiency (PTE) in Qiqihar, Jixi and Yichun had a more significant impact on the TE, and PTE had a greater impact on the development of low-carbon tourism economy in these regions. Hegang, Daqing, Shuangyashan, Kiamusze, Heihe and Suihua have a higher MI, and the TE has maintained a stable growth state overall.

The role of R&D and economic policy uncertainty in Sri Lanka\u2019s economic growth

In this paper, we assess the role of investment in research and development (R&D) and economic policy uncertainty (EPU) in Sri Lanka’s economic growth experience. We do this by first determining which endogenous growth theories best explain the evolution of total factor productivity (TFP) in the country. Using historical time series data (1980–2018), we find that semi-endogenous growth theories best explain the evolution of TFP in Sri Lanka. This evidence suggests that R&D is critical to the country’s TFP expansion. We find that, through R&D, EPU has a crucial detrimental impact on TFP growth, although it is short-lived. Our findings are robust and have important implications for R&D investment and for moderating EPU.

La productividad del sector manufacturero: caso Colombia 2005-2016

El objetivo de este trabajo es analizar empíricamente la evolución de la productividad total de los factores (PTF) en la industria manufacturera colombiana de 2005 a 2016, a través de la estimación del Índice de Malmquist (IM), con un panel de veintinueve subsectores productivos. Los resultados muestran una caída promedio en la PTF de la manufactura colombiana de 1.1%, derivado de un retroceso en el componente tecnológico. Se recomienda a los hacedores de política promover el uso de Tecnologías de la Información y la Comunicación, así como innovaciones tecnológicas. La limitación encontrada corresponde a la falta de información desagregada a nivel empresa de la totalidad de unidades económicas del sector durante el período de análisis. La originalidad de la investigación recae en el monitoreo de los cambios en la productividad de la manufactura y su descomposición en eficiencia y tecnología a lo largo del tiempo. En conclusión, durante el período de estudio se vislumbra una desindustrialización temprana del sector manufacturero, donde los componentes de eficiencia y de tecnología no fueron en la misma dirección.

THE AUTOMOTIVE SECTOR IN SPAIN. INFLUENCE OF R&D INVESTMENT ON THE IMPROVEMENT OF TOTAL FACTOR PRODUCTIVITY

The current globalised environment has been preceded by a generalised increase in the diffusion and use of Information and Communication Technologies (ICT), as well as by a large investment in Research and Development (R&D) by companies. This circumstance makes the use of these technologies fundamental for the automotive sector to face with guarantees the growing international competitivity. Thus, the correct use of ICT provides an improvement in productivity, and therefore in the competitiveness of enterprises. This article analyses the evolution of total factor productivity (TFP) in the Spanish automotive sector for the year 2017, in order to determine the influence this variable has on the improvement of total factor productivi

Analysis of productivity in the Spanish wind industry

This paper provides an empirical analysis of the evolution of total factor productivity (TFP) among Spanish wind farms. The Malmquist productivity index (MPI) is used to measure how productivity evolves. The index makes it possible to break down total productivity performance into the components of technological change and changes in technical efficiency. Technical efficiency is then further broken down into changes in purely technical efficiency and changes in scale efficiency. The analysis is carried out by estimating two alternative models, enabling the assessment of the impact of the different kinds of technology used on the wind farms.From the results, it may be concluded that it is important to model the way in which the farms use different kinds of technology. Including technology as an additional input allows makes it possible to correct the estimations of changes in productivity and its components. Once these estimations have been corrected by including the different technologies utilized, the results indicate that growth in productivity (around 2% annually) is mainly due to changes in the technical efficiency growth rate, specifically in the component of pure technical efficiency. In contrast, the technical change component does not contribute to growth in productivity, indicating that technological capacity has not been optimized on most wind farms. It should be highlighted that, while the results of productivity are fundamentally conditioned by the technology variable, they are also affected by variables that are exogenous to the productive processes. In light of these results, policy implications are discussed.

Croissance de la productivité et réallocation des ressources en France : le processus de destruction création

[eng] Based on a large sample of French firms, this article examines the contribution of resource reallocation and of the learning effect to changes in total factor productivity (TFP) before (2000-2007) and after (2008/2009-2012) the 2008 crisis. First, we show that there was very little TFP growth before the crisis and that a fall occurred between 2008 and 2012. Second, we show that the evolution of TFP is highly dependent on the learning effect, as measured here by internal firm performance. Its negative contribution after the crisis is indicative of the difficulties experienced by firms in France in adjusting their production scale rapidly and effectively. However, this effect was reduced by 1) a process of resource reallocation towards the most productive continuing firms, which only really took hold from 2009 onwards, and 2) an earlier Schumpeterian process of creative destruction (cleansing effect), the first signs of which appeared in 2008.

Low frequency drivers of the real interest rate: Empirical evidence for advanced economies

AbstractThis article presents an empirical analysis of the underlying drivers of the real interest rate in advanced economies since 1980. We adopt a band spectrum regression approach, which allows us to study the link between the real interest rate and its determinants only over low frequencies, leaving aside business cycle fluctuations and high frequency noise. Spectral regressions are pooled across countries, allowing for country fixed effects. Our findings indicate that most of the long‐term movements of real interest rates are explained by the evolution of total factor productivity (with a specific role for human capital accumulation) and demographic trends. Monetary policy and credit developments, instead, appear to play a limited part. According to our estimates, over recent years the natural rate of interest has remained positive in the United States and United Kingdom, but fell below zero in the euro area and Japan. Finally, the paper provides an empirical contribution to the debate on secular stagnation, suggesting that supply‐side mechanisms were one of the most significant factors behind the fall in income growth in the advanced economies over the last two decades.

Evaluation of efficiency in Colombian hospitals: An analysis for the post-reform period

In this study we analyze the performance of 602 level 1 Colombian hospitals for the period 2009–2013. The analysis is carried out from both static and temporal perspectives in order to evaluate the evolution of total factor productivity (change in hospital performance) and its components throughout the period. The study also explores a question relevant not only to the Colombian health system, but to many others around the world, of whether primary care centers excessively refer patients to high-level hospitals, thereby negatively affecting the quality, efficiency, and effectiveness of all healthcare service provision. The results demonstrated that adjusted production (service provision) and levels of quality and referrals to higher-level hospitals could be improved, on average, by 44%. This increase in health service provision levels and their quality can be achieved by reducing personnel expenditure (by an average of 22%), expenditure on medicines (by 20%), and purchasing expenses (by 11%). The temporal analysis shows that total factor productivity (hospital performance change) worsened by 1% during the period, mainly due to the technological backlash experienced despite a slightly positive evolution in efficiency.

Global Economic Growth and Agricultural Land Conversion under Uncertain Productivity Improvements in Agriculture

AbstractWe study how stochasticity in the evolution of agricultural productivity interacts with economic and population growth at the global level. We use a two‐sector Schumpeterian model of growth, in which a manufacturing sector produces the traditional consumption good and an agricultural sector produces food to sustain contemporaneous population. Agriculture demands land as an input, itself treated as a scarce form of capital. In our model both population and sectoral technological progress are endogenously determined, and key technological parameters of the model are structurally estimated using 1960‐2010 data on world GDP, population, cropland and technological progress. Introducing random shocks to the evolution of total factor productivity in agriculture, we show that uncertainty optimally requires more land to be converted into agricultural use as a hedge against production shortages, and that it significantly affects both optimal consumption and population trajectories.

Low Frequency Drivers of the Real Interest Rate: A Band Spectrum Regression Approach

This paper presents an empirical analysis of the underlying drivers of the real interest rate in advanced economies over the last 35 years. We adopt a band spectrum regression approach, which allows to study the link between the real interest rate and its determinants only over low frequencies, leaving aside business cycle fluctuations and high frequency noise. Spectral regressions are pooled across countries, allowing for country fixed effects. Our findings indicate that important factors affecting the long-term movements of real interest rates are the evolution of total factor productivity (with a specific role for human capital accumulation) and demographic trends. Monetary policy developments and changes in income inequality, instead, appear to play a limited part. According to our estimates, over recent years the natural rate of interest fell below zero in the euro area. Finally, the paper provides an empirical contribution to the debate on secular stagnation, suggesting that supply-side mechanisms were one of the most significant factors behind the fall in income growth in the advanced economies over the last two decades.

Assessing the productivity growth of Indian banks during the post-deregulation period using non-radial Malmquist productivity index

By using an unbalanced panel dataset for the period 1991-1992 through 2007-2008 and employing non-radial Malmquist productivity index approach, this paper examines the evolution of total factor productivity (TFP) change in Indian banks, and identifies dominant source of productivity change. The empirical results indicate that TFP in Indian banking industry followed an uptrend during the post-deregulation period, albeit the trend was modest. Further, the observed productivity growth was almost entirely attributable to technological progress. While the public sector banks made steadier progress in productivity, the de novo private banks outperformed their peers. The empirical findings also reflect the enormous relevance of foreign ownership in Indian banking industry since foreign banks have emerged as the leading technological innovators in the banking system.

What are the drivers of total factor productivity in the European Union?

ABSTRACTThis paper examines the evolution of total factor productivity (TFP) over time, as well as across countries and sectors, and investigates its determinants. To this end, a panel data set of 17 European Union (EU) countries and 13 sectors over the period 1995–2007 is used as part of a twofold approach. First, we estimate aggregate and sectoral TFP for 17 EU countries by means of the augmented mean group estimator to control for endogeneity, cross-section dependence and heterogeneous production technologies. Second, we investigate the relative importance of the drivers of predicted TFP using a dynamic ordinary least-squares estimator. The results indicate that rationalization, human capital and information and communication technologies are the main drivers of TFP.

Environmental stakeholders, environmental strategies, and productivity of Tunisian manufacturing industries

The main objective of this study was to analyze the impact of environmental strategies on productivity in industries that face different environmental stakeholders' pressures using the data of 26 Tunisian manufacturing industries over the period 1994–2008. We first measured the evolution of total factor productivity (TFP) as well as its components using the output-oriented Malmquist productivity index method. Our findings revealed that TFP has witnessed an average increase of 1.5% per year during the above mentioned period. This growth can be explained by technological progress (1.6%) and a loss efficiency (0.1%). Second, we assessed the effect of the environmental strategies on the TFP growth using a panel data model. Our results showed that the pollution abatement activities have two major effects. On the one hand, they negatively affected productivity. On the other hand, they could improve and develop the economic activity.

English

The production of cotton has great economic importance in Egypt. However, in the last years an important decline was observed both in cotton production and cultivated area. One of the suggested causes of this decline is the low productivity growth. In this paper we employ the stochastic frontier analysis to analyze the evolution of total factor productivity (TFP) from its determinants (including the efficiency). The empirical results indicate that technical efficiency improves substantially during the period considered, but TFP growth is small. This low growth is due primarily to the unfavorable evolution of technical progress. Policy implications are offered in light of the results. Key words: Cotton, Egypt, stochastic frontier, technical efficiency, technical progress, total productivity.

The influence of the road network on private productivity measures using Data Envelopment Analysis: A case study from Spain

We evaluate the economic effects of investment in the road network on private regional activity. We employ provincial Spanish panel data from 1980 to 2007 to perform non-parametric frontier techniques based on Data Envelopment Analysis and to obtain the Malmquist productivity indexes, thus enabling us to examine the evaluation of the productivity growth via technological changes or efficiency gains. Additionally, we analyze the role of transport infrastructure on the evolution of Total Factor Productivity and its components through econometric techniques. Our results show important spillover effects. Moreover, our findings have significant implications for policy makers if we take into account the fact that the use of the road network in economic activity or in commercial relations greatly influences productivity growth.

The UK Productivity and Jobs Puzzle: Does the Answer Lie in Wage Flexibility?

UK GDP per worker fell by almost 4% in the five years following Lehman's collapse in 2008, something unprecedented in post-war history. A possible reason for poor productivity is low growth in the effective capital-labour ratio. This is likely to have occurred because there has been a fall in real wages and increases in the cost of capital due to the financial crisis. We simulate various changes in the capital-labour ratio and after accounting for these changes, the evolution of total factor productivity appears much more similar to earlier severe recessions and likely to be related to underutilised resources.

The impact of public reforms on the productivity of Spanish ports: A parametric distance function approach

This paper analyses the evolution of total factor productivity and its decomposition between 1986 and 2005 in the Spanish port authorities using a parametric distance function approach. During this period, the Spanish port authorities experienced three important regulatory changes. The results show that technical progress and scale efficiency gains improved the total factor productivity, whereas technical efficiency losses reduced the total factor productivity. The change in the model of port management from a tool port model to a landlord port model, the Spanish economic policy in the early nineties, the adoption of particular technologies and the ports’ overcapacity could explain these results.

No Mangoes in the Tundra: Spatial Heterogeneity in Agricultural Productivity Analysis*

AbstractIn line with the wider macro productivity literature existing studies of agricultural production largely neglect technology heterogeneity, variable time‐series properties and the potential for heterogeneous but correlated total factor productivity (TFP) across countries. Our empirical approach accommodates these difficulties and seeks to model the nature of the cross‐section dependence in a sample of 128 countries (1961–2002). Our results suggest that agro‐climatic environment drives similarity in TFP evolution across countries with heterogeneous production technology. This provides a possible explanation for the failure of technology transfer from advanced countries of the temperate ‘North’ to arid and/or equatorial developing countries of the ‘South’.