‘Productivity’ is, at its simplest, a measure of how effectively or efficiently a workplace, a business or government agency, a region or a nation as a whole uses the resources at its disposal to produce goods and services which are in turn valued, in some way, by those who consume or use them. At the level of individual workplaces or firms, productivity measures are often expressed in terms of output per unit of a single factor of production, such as land or livestock (in agriculture), some measure of ore extracted (in mining), or, in manufacturing and services businesses, some measure of labour input such as person-hours. At more aggregated or economy-wide levels, productivity is usually expressed as a measure of value added (such as gross product) either per unit of labour input (labour productivity) or per unit of labour and capital services inputs (multifactor productivity). While, conceivably, other factors of production could be included in measures of multifactor productivity, including environmental factors such as water or energy, to date these have been extremely rare, but they may become more widely used as the policy focus on the use of finite natural resources (and their price) increases.

Productivity - the lost decade

Using the business cycle accounting framework [Chari V., P. Kehoe and E. McGrattan 2007. Business Cycle Accounting. Econometrica 75, 781-836.], this paper sheds new light on the French Great Depression. Frictions that reduce the efficiency with which factor inputs are used (efficiency wedge) were the primary factor in the economic downturn. The decline in consumption can be attributed to distortions in the Euler equation (investment wedge). In addition, frictions creating a gap between the marginal rate of substitution and the marginal product of labor (labor wedge) contributed to the slowdown of the economy after 1936. This drop in the efficiency wedge might have resulted from financial frictions and tariff policies, whereas the investment wedge might have been caused by financial frictions due to agency costs. A potential explanation for the decline of the labor wedge after 1936 is institutionals changes in the labor market.

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The French Great Depression: A Business Cycle Accounting Analysis

Trend inflation and macroeconomic stability in a small open economy

This paper presents a Ramsey-like dynamic small open economy with endogenous labor migration. In the model, the domestic economy is free to borrow or lend as much as it wants at the given world interest rate, and individuals are supposed to be free to move from a country to another in response to the emergence of a wage differential between countries. Our analysis can be ideally split in two parts. Initially, we propose a baseline model in which only natives are allowed to save and invest in capital assets and traded bonds, whereas immigrants are credit constrained. Next, we provide an extension in which all individuals, including immigrants, have full access to international financial markets. We find that the steady state is always local indeterminate, and that the adjustment dynamics of the competitive equilibrium is dependent upon the initial level of the immigration ratio.

Equilibrium indeterminacy in one-sector small open economies: the role of international labor migration

Estimated microproduction functions confront two major problems—those of (1) unknown functional forms and (2) the measurement of capital independent of the distribution of output among the factors of production. The latter problem has emerged unresolved from the earlier Cambridge capital controversy. In the presence of these two problems, all specifications of microproduction functions have involved nonunique coefficients and error terms. We provide a method of deriving time-varying coefficients that produces unique coefficients and error terms. Specifically, we respecify the microproduction function in such a way that its coefficients are the sums of (i) the appropriate partial derivatives and (ii) exact representations of excluded-variable biases. By decomposing the total coefficients, we obtain the unique coefficients and a unique error term. Our treatment of heterogeneous capital is not subject to the criticisms of that concept that emerged during the Cambridge controversy.

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Microproduction functions with unique coefficients and errors: a reconsideration and respecification

What accounts for the Australian business cycle, what caused the economic slumps and what factors contributed to the decades’ buoyancy? To understand these questions, the current paper decomposes the Australian business cycle into its sources for the period 1980–2014. Our main finding is that the efficiency wedge and the investment wedge are the major forces behind Australian output variations. The efficiency wedge is behind the growth slowdown that emerged in the mid 2000s.

Observations on the Australian Business Cycle

This paper examines the effect of the elasticity of technological substitution on the existence of equilibrium indeterminacy in two-sector economies. Following recent empirical evidence, the elasticity of substitution between capital and labor is below unity and we find that this requires a higher degree of productive externalities in order to still be able to produce indeterminate equilibria. However, empirically realistic rates of substitution do not rule out indeterminacy.

Capital–labor substitution, sector-specific externalities, and indeterminacy

The first part of this study was the application of ‘Trip Frequency One Site Model’ for tourism in each province of the Eastern Region of Thailand. This ‘Single Site Model’ used Individual Travel Cost Approach and most suitable regression results (Double Log Demand Functions) for Thai and foreign tourists. The second part was the application of ‘General Logit Model for Multiple Sites’. This was to analyze the probability of reservation of accommodations, excursion and/or tour packages through internet. The results implied that, for the Eastern Region in 2011, the value of recreational benefits for both Thai and foreign tourists were far exceeding the total amount of the budget allocated for the tourism development promotion. Therefore, the government should invest in tourism promotion especially for Thai tourists who are traveling by cars and not for foreign tourists. The foreign tourists should be promoted in groups.

Strategic economic assessment on the tourism promotion program in the eastern region of thailand

Abstract Family and intergenerational relationships are becoming increasingly important as sources of support and care for the elderly population in rapidly ageing Asian societies. However, this has also raised concerns over reinforcement of cultural preference for sons as a source of old-age security. This paper therefore revisits the question—what determines happiness in old age—by investigating the role of adult children’s gender in the context of Thailand, an ageing Asian country with no legacy of sex-preference in fertility. We employ nationally representative data to examine the association between old-age happiness and presence of a co-residing child. Compared to living alone, living with at least one child is found to positively associate with older persons’ happiness. However, this result is specific to daughters. Moreover, compared to older men, women systematically benefit from a “daughter effect”. Co-residing daughters with university education and those who maintain a good relationship with their parents help explain the positive happiness effect on older persons. Co-residing daughters are also positively linked to reduced loneliness; improved self-rated health; and improved economic conditions of older parents. Our findings suggest that policies that increase human capital of the girl child and enhance family solidarity are likely to have long term intergenerational wellbeing benefits. 

https://doi.org/10.1007/s10902-023-00655-1

Nopphawan Photphisutthiphong

Papers

Observations on the Australian Business Cycle

Capital–labor substitution, sector-specific externalities, and indeterminacy

Strategic economic assessment on the tourism promotion program in the eastern region of thailand

Happiness in Old Age: The Daughter Connection