Showing papers on "Productivity model published in 2012"

Measuring Aggregate Productivity Growth Using Plant-Level Data

Abstract: We define aggregate productivity growth (APG) as the change in aggregate final demand minus the change in the aggregate expenditures on labor and capital. We show how to aggregate plant-level data to this quantity and how to decompose APG into technical efficiency and reallocation components. This requires us to confront the “non-neoclassical” features that impact plant-level data, including plant-level heterogeneity, the entry and exit of goods, adjustment costs, fixed and sunk costs, and market power. The APG decomposition includes one term per plant related to technical efficiency and one term for each input at each plant that is a function of the value of marginal product - input price gap and that relates the reallocation of inputs to growth. We compare APG to several competing variants of productivity growth that are based only on plant-level technical efficiency. Two simple theoretical examples illustrate that technical-efficiency reallocation can be negatively correlated with actual APG reallocation because technical efficiency is a production concept and need not have any relation with the APG reallocation gaps. We illustrate this point empirically using panel data from manufacturing industries in Chile, where we show technical-efficiency reallocation differs substantially from measured reallocation based on our definition of APG.

The sources of bank productivity growth in China during 2002-2009: A disaggregation view

Abstract: This study investigates the sources of bank productivity growth in China over the period 2002–2009. In order to perform this research, we propose an advanced index – input slack-based productivity index (ISP) – a model that disaggregates total factor productivity growth into each input productivity change. Funds, capital, and employees are chosen as the inputs, whereas loans and other earning assets are outputs in this study. Our results show that technological gains transcend the efficiency regressions and result in total factor productivity growth. More specifically, technical progress in capital productivity reveals the dominant force behind the total factor technical change and productivity improvement. In addition, this paper uses these disaggregation terms to find out the competitive advantages and disadvantages of input usages for each Chinese bank. These findings indicate that the ISP index provides more insights than traditional total factor productivity indices.

Determining the shape of the productivity function for mechanized felling and felling-processing

Abstract: Productivity studies in forest operations are often carried out on new equipment, or on equipment being used in new conditions. Understanding how stand and terrain parameters impact the productivity of harvesting machines is important for determining their optimum use. Such information is normally presented as a productivity or efficiency function; that is, a regression equation that best represents the data. Most studies establish that piece size is the dominant predictor that impacts overall productivity. A common concept known as the “piece-size law” is that productivity increases at a decreasing rate with increasing piece size. What is not well understood is the upper limit to this piece-size law. That is, as the trees get “too” large, we can expect the machine to start to struggle, resulting in a decrease in productivity. Four different data sets—two based in New Zealand and two in Italy—are presented that clearly show an “optimum” piece size for maximum productivity. On average, productivity tended to decrease gradually, not drop off suddenly beyond the optimum. Using more complex statistical functions, it was possible to correctly correlate piece size to productivity.

Wood Extraction with Farm Tractor and Sulky: Estimating Productivity, Cost and Energy Consumption

Abstract: A winch and a sulky can transform a farm tractor into an effective small-scale logging machine, closely resembling a wheeled cable skidder. The additional cost of these implements is very small, but they offer significant benefits when extracting timber under the conditions of small-scale forestry. The authors developed a productivity model for skidding timber with wheeled farm tractors, equipped with winch and sulky. The origin data pool contained over 300 individual skidding cycles, extracted from 8 separate tests. Statistical analysis of the data allowed calculating a simple mathematical relationship for estimating skidding productivity as a function of significant work conditions, such as: piece size, winching distance, tractor power, skidding distance and crew size. This model can provide useful directions to prospective users, contributing to operation planning, costing and optimization. It can predict a large proportion of the variability in the data and was successfully validated using reserved cycle records, extracted from the same data pool and not used for model development. Depending on tractor power and piece size, the average turn volume and productivity can exceed respectively 2 m3 per cycle and 4 m3 per Scheduled Machine Hour (SMH). Top performance can reach 8 m3 SMH−1, with heavy tractors and large logs.

Productivity change and innovation in Norwegian electricity distribution companies

Abstract: Regulators of electricity distribution networks have typically applied Data Envelopment Analysis (DEA) to cross-section data for benchmarking purposes. However, the use of panel data to analyse the impact of regulatory policies on productivity change over time is less frequent. The main purpose of this paper is to construct a Malmquist productivity index to examine the recent productivity change experienced by Norwegian distribution companies between 2004 and 2007. The Malmquist index is decomposed in order to explore the sources of productivity change, and to identify the innovator companies that pushed the frontier forward each year. The input and output variables considered are those used by the Norwegian regulator. In order to reflect appropriately the exogenous conditions where the companies operate, the efficiency model used in this paper incorporates geography variables as outputs of the DEA model. Unlike the model used by the regulator, we included virtual weight restrictions in the DEA formulation to correct the biases in the DEA results that may be associated to a judicious choice of weights by some of the companies.

Problems with (dis)aggregating productivity, and another productivity paradox

Abstract: Using a standard definition of productivity growth, it is shown that a country may have higher productivity growth than another country in each sector, but may have a lower productivity growth rate overall. Also, it is shown that popular methods for aggregating firm/industry estimates of productivity growth have a serious problem in that productivity of all firms/industries can go up, but aggregate productivity can fall. This is not necessarily due to changes in the reallocation of resources across firms/industries. Hence, there are problems for the interpretation of previously published articles which use these methods. There can be inappropriate assessments of the cyclical properties of productivity, and the productivity impact of industry dynamics, micro-economic reforms and regulatory change. Index-number methods that avoid these aggregation problems are introduced.

Agricultural Productivity and Macro-Economic Variable Fluctuation in Nigeria

Abstract: The study established the empirical relationship between value of agricultural GDP as the ratio of total GDP (proxy as agricultural productivity) and some key macroeconomic variables in Nigeria. Augmented Dickey-Fuller unit root test and improved ADF-GLS unit root test conducted on the specified time series showed that all series were integrated of order one. The short-run and long-run elasticity of the agricultural productivity with respect to some key macro-economic variables were determined using the techniques of co-integration and error correction models. The empirical results revealed that in the short and long run periods, the coefficients of real total exports, external reserves, inflation rate and external debt have significant negative relationship with the agricultural productivity in the country; whereas industry’s capacity utilization rate and nominal exchange rate have positive association with agricultural productivity in both periods. However, per capita real GDP influence on the agricultural productivity was positive and significant only in the ECM model. The empirical results were further substantiated by the variance decomposition and impulse response analysis of the dependent variable with respect to changes in the explanatory variables. Results obtained were in line with economic theory. The findings call for appropriate short and long term economic policy packages that should stimulate investment opportunities in the agricultural sector so as to increase agricultural component in the country’s total export. Appropriate policy package to stabilize inflation rate in the country should be implemented. Also incentives should be given to the industrial sector to boast production in order to increase capacity utilization and promote backward integration policy of the sector. Diversification of the country’s economy and a drastic reduction in external debt would boost agricultural productivity in the country.

Time Pressure, Performance, and Productivity

Abstract: Originality/value of chapter – The evidence reviewed here suggests that setting deadlines wisely can help maximize productivity.

Productivity Growth in German Dairy Farming using a Flexible Modelling Approach

Abstract: A random-coefficients specification of an output distance function is used to measure and decompose productivity growth in German dairy farming. This specification can accommodate heterogeneity with respect to the technology employed by dairy farms, allowing for specialised and non-specialised farms to be included in the analysis. The proposed modelling approach is favoured by the data when compared with the conventional translog specification of distance functions. The average total factor productivity growth rate for German dairy farms is estimated at 1.1%, with the technical progress component contributing most of this growth.

Productivity : should we include bads?

Abstract: This paper studies the interaction between economic and environmental performance. Applying the directional output distance function approach, the purpose is to compare estimates of Luenberger total factor productivity indicators, including and excluding bad outputs. Specifically, based on unique firm level data from Swedish manufacturing covering the period 1990 to 2008, we explore to what extent excluding bad outputs leads to erroneous productivity measurement. The main conclusion is that bad outputs should not only be included in the estimations, but also reduction in bad outputs should be credited. From this point of view the directional output distance function approach and the Luenberger indicator serves as an appropriate basis of productivity measurement.

Productivity Models for Operational Planning of Timber Forwarding in Croatia

Abstract: In the area of Croatian lowland forests, forwarders are usually used for extraction of timber assortments. Within the project »Systematization of norms for the production of timber assortments«, which was financed by the state company »Hrvatske sume« d.o.o. (»Croatian Forests« LLC), the process of development and implementation of new productivity norms for forwarders was carried out. Initially, for the execution of the research, it was necessary to gather data about technical characteristics of forwarders most frequently used in Croatia, but also around the world. The morphological analysis was performed and it was the basis for the classification of forwarders into classes. Three classes of forwarders were obtained after cluster analysis and load capacity appeared to be the most important factor. Machine performance was evaluated on 30 research sites. The standard method of time study (snap-back chronometric technique) was used. During the recording process, data of factors influencing forwarding (stand and terrain conditions) were collected. After analyzing the collected data, it was determined that the forwarding productivity depends on the forwarder class, average extraction distance, load characteristics, terrain and stand conditions. Regression analysis was used for identifying the time consumption of individual work components, and the productivity model for forwarding was developed. The obtained model was implemented into the application HsPPI. This is a part of the information system developed by IT Department of the state enterprise »Hrvatske sume« d.o.o. and is used for production planning in timber harvesting. The system is based on dBase IV databases and two main program modules. The main parts of the system are: tree marking data, assortment structure plan, production plan (felling, processing and extraction) and sales plan. Within a part of the production plan there is a module for calculating productivity norms for timber forwarding.

How to measure the economic impacts of changes in growth, feed efficiency and survival in aquaculture

Abstract: In this article we introduce a variety of bio-economic models that can be used to calculate the economic benefits associated with improved productivity in aquaculture. In the aquaculture industry, three important biological productivity factors are growth, survival and feed efficiency. The profitability of improving productivity factors, especially growth, is highly dependent upon the cost factor structure, production system, its constraints and other factors within the supply chain. Therefore we present a number of different bio-economical models that can be used to robustly assess the economic impacts in different production environments. These models are introduced with case examples across a range of aquaculture species and production systems. We calculate changes in profitability through a reduction in production costs and any potential increases in product price premiums via the use of weight dependent unit profit as the outcome in cost-benefit analysis, so that results may be expanded to cover diff...

Biased Technical Change, Intermediate Goods and Total Factor Productivity

Abstract: In this paper I show that the intensity at which intermediate goods are used in the production process affects aggregate total factor productivity (TFP). To do this, I construct an input–output model economy in which firms produce gross output by means of a production function in capital, labor, and intermediate goods. This production function is subject, together with the standard neutral technical change, to intermediates-biased technical change. Positive (negative) intermediates-biased technical change implies a decline (increase) in the elasticity of gross output with respect to intermediate goods. In equilibrium, this elasticity appears as an explicit part of TFP in the value added aggregate production function. In particular, when the elasticity of gross output with respect to intermediates increases, aggregate TFP declines. I use the model to quantify the impact of intermediates-biased technical change for measured TFP growth in Italy. The exercise shows that intermediates-biased technical change can account for the productivity slowdown observed in Italy from 1994 to 2004.

Labor Productivity Parity vs Trend of Exchange Rate

Abstract: Translation, understood as a process of restating the value from a particular currency to another currency, is based on the market exchange rate. So in practice, almost every value in terms of goods, assets, liabilities, and wages is converted to US dollars according to the current exchange rate. A fundamental method of translation was originated by Balassa and Samuelson in 1964 who explained that the main driver of the exchange rate is productivity, which is higher in developed countries and lower in poor countries. That is why these differences must be eliminated in order to make the exchange rate useful. However, different research verifying the Balassa-Samuelson approach, especially in the long run, had revealed some inconsistencies. Recently the Balassa-Samuelson theory has been enriched by more precise determination of productivity; specifically, an appropriate ratio for the translation procedure has appeared labor productivity Q defined as quotient of real GDP to cost of labor. The main aim of the paper is to present statistical verification of labor productivity parity as the main driver of the exchange rate. In the research, there will be an estimation of parameters of linear function in which the dependent variable represents the average exchange rate for the period between a particular country and the USA, and the independent variable is the average hourly pay quotient modified by labor productivity parity. If the linear function parameters describe the y = x relation, the theory of labor productivity as the determinant of exchange rate behavior will be confirmed.

Labor productivity convergence in the Kansas farm sector: a three-stage procedure using data envelopment analysis and semiparametric regression analysis

Abstract: This paper employs a three stage procedure to investigate labor productivity growth and convergence in the Kansas farm sector for a balanced panel of 564 farms for the period 1993–2007. In the first stage, Data Envelopment Analysis is used to compute technical efficiency indices. In the second stage, labor productivity growth is decomposed into components attributable to efficiency change, technical change, and factor intensity. The third stage employs both parametric and semiparametric regression analyses to investigate convergence in labor productivity growth and the contribution of each of the three components to the convergence process. Factor intensity and efficiency change are found to be sources of labor productivity convergence while technical change is found to be a source of divergence. Policies that encourage investment in capital goods may help to mitigate disparities in labor productivity across the farm sector.

Economic Reform and Total Factor Productivity Growth in Indian Manufacturing Industries

Abstract: A stochastic frontier production function model is applied to Indian manufacturing industries, to decompose the sources of total factor productivity growth into technical progress, technical efficiency, scale efficiency, and allocative efficiency. Empirical results based on data from 2000 to 2006 suggest that increased investment needs time to deliver increased productivity and efficiency, because new technology combined with fresh investment requires higher numbers of skilled workers, better managerial practices and an advanced input mix, all of which generally take time to develop. Thus, the Indian economy must boost technical efficiency by providing skilled workers and high quality managers to further economic reform.

Labour productivity measurement with variable returns to scale in Australia's construction industry

Abstract: As an important productivity indicator, the change of labour productivity is one indispensable marker in determining the rise or fall of overall industrial performance. This study aims to address whether the labour productivity level of the Australian construction industry has, in fact, shown a huge improvement during the last few decades. This article constructs a measuring method estimating labour productivity changes based on the data envelopment analysis technique with variable returns to scale. By adopting a production frontier approach, the labour productivity index can be broken down into components attributable to efficiency change, technological progress and capital accumulation. The numerical results exemplified by a single-input and single-output system indicate that the average annual labour productivity levels of the construction industry are slowly growing in all the Australian states and territories. However, the year-on-year change in the overall labour productivity performance does not ma...

The measurement of productivity in the nonmarket sector

Abstract: In many sectors of the economy, governments either provide various services at no cost or at highly subsidized prices. Examples are the health, education and general government sectors. The System of National Accounts 1993 recommends valuing these nonmarket outputs at their costs of production but it does not give much guidance on exactly how to do this. In this paper, an explicit methodology is developed that enables one to construct these marginal cost prices. However, in the main text, an activity analysis approach is taken in order to simplify the analysis, so in particular, constant returns to scale, no substitution production functions for the specific activities in the nonmarket sector are assumed. It is shown that it is possible to obtain meaningful measures of Total Factor Productivity growth in this framework. An “Appendix” relaxes some of the restrictive assumptions that are used in the main text.

Productivity and energy balance of forest plantation harvesting in Uganda

Abstract: The study evaluated the productivity and energy balance of the harvesting and the extraction of wood in plantation of exotic tree species, i.e., Pinus patula (Schiede ex Schlectendahl et Chamisso) and Cupressus lusitanica (Mill.). The harvesting and extraction operations concerned clear-cut felling on two different types of terrain (gentle and steep terrain) and two levels of pruning. The results show that cutting is not affected by the terrain gradient whereas the pruning condition shows a significant effect on the delimbing operation. The productivity of cutting is evaluated at 28.1 m3·d−1 for unpruned trees and at 30.2 m3·d−1 for pruned trees. For the extraction phase, rolling was significantly affected by terrain conditions. On steep terrain, the gross productivity can be evaluated at 22.5 m3·d−1 for an extraction distance of 40 m, while for the same distance on gentle terrain the productivity decreases to 14.1 m3·d−1. As a result, the steep terrain condition showed higher energy efficiency, suggesting that it is the more efficient system of extraction. The productivity model and the energy balance resulting from the study provide a better understanding of the variables affecting motor-manual cutting and rolling extraction in exotic plantations in Uganda.

Applications of Different Optimization Methods for Metal Cutting Operation - A Review

Abstract: Optimum selection of the cutting conditions effectively contributes to the increase in the productivity and reduction in the production cost, therefore utmost attention is paid to this problem. Optimization of cutting parameters is essential for a manufacturing unit to respond effectively to severe competitiveness and increasing demand of quality product in the market. In cutting process, optimization of cutting parameters is considered to be a vital tool for improvement in output quality of a product as well as reducing the overall production time. An optimization technique provides optimal or near optimal solution of optimization problem, which can be implemented in the actual metal cutting process. Quality and productivity play a major role in today's manufacturing market. From a customer's viewpoint, quality is very important because the extent of quality determines the degree of satisfaction of the customers. Apart from quality, there exists another important criterion called productivity which is directly related to the profits of an industry and also to its growth. Every manufacturing firm aims at producing larger number of units with in short time. Productivity can be increased by having sound knowledge of all the optimization techniques for machining. In this research paper, a comparison has been made between different optimization including their approaches. The proposed research can be very helpful for industries to determine the optimal cutting parameters and improve the process quality. The comparison will also be beneficial in minimizing the costs incurred and improving productivity of manufacturing firms.

Comparison of primary productivity algorithms for Korean waters

Abstract: This study compares five primary productivity algorithms for Korean waters. Five algorithms are in the form of vertical generalized production models: One algorithm is for gross primary production and four are for net primary production. The five algorithms were evaluated using 117 in situ primary production datasets observed by 20 cruises from 1994 to 2011 in Korean waters (East Sea, Yellow Sea, East China Sea, and Yeosu Bay). The results show that the regionally-tuned variants give better results than the original formulation. We recommend, among the tested algorithms, YSVGPM (Yellow Sea Vertically Generalized Productivity Model) for gross primary productivity algorithm and Kameda-Ishizaka algorithm for net primary productivity algorithm for estimating primary production in Korean waters.

Capital use intensity and productivity biases

Abstract: Measures of productivity growth are often pro-cyclical. This paper focuses on measurement errors in capital inputs, associated with unobserved variations in capital utilization rates, as an explanation for the existence of pro-cyclical patterns in measures of productivity. Recently constructed national and state-specific indexes of inputs, outputs, and productivity in U.S. agriculture for 1949–2002 are used to estimate production functions that include proxy variables for changes in the utilization of durable inputs. The proxy variables include an index of farmers’ terms of trade and an index of local seasonal growing conditions. We find that utilization responses by farmers are significant and bias measures of productivity growth in a pro-cyclical pattern. We quantify the bias, adjust the measures of productivity for the estimated utilization responses, and compare the adjusted and conventional measures.

The Leadership Productivity Model

Abstract: What are the core dimensions of leadership productivity? Which leadership tasks need to be performed to increase the productivity of employees?

Identifying productivity blemishes in Pakistan automotive industry: a case study

Abstract: Purpose – The purpose of this research is to identify the prevalent condition of productivity in the automotive manufacturing industry of Pakistan and to indicate the possible areas for enhancing productivity.Design/methodology/approach – Secondary data for the last ten years were gathered. Total productivity and all partial productivities were computed using methodology proposed by Sumanth, and total factor productivity (TFP) was computed using Cobb‐Douglas production function. Regression analysis and Pearson correlations were run to determine labor elasticity and capital elasticity.Findings – Results indicated very low levels of labor productivity and capital productivity, resulting in huge losses and stagnant growth of these firms. Increasing returns to scales (IRTS) with high values of labor elasticity and low and even negative value of capital elasticity were computed. Low values of TFP showed minimal utilization of technology in these firms.Research limitations/implications – One of the limitations ...

The Efficiency of Regional Logistics Industry in China——Based on the Three-stage DEA Model Using Malmquist-luenberger Index

Abstract: This paper employs the Malmquist-luenberger(ML) productivity index to evaluate the efficiency of regional logistics industry in 30 provinces of China,incorporating undesirable outputs,during the period from 1997 to 2009Based on the three-stage DEA model,the paper also explores the external operating environment and its impact on improvements in ML productivityThe results show that:(1)The annual ML productivity growth is-045%,whereas the value of the traditional Malmquist productivity growth is 102%,meaning that the total factor productivity of logistic industry in China is overestimated if undesirable outputs are ignoredLogistics industry is universal absence of technology environmental protection(2)As the impacts of exogenous environmental variables and random shocks are filtered out,the technological progress of logistic industry has decreased greatly,whereas,the technical efficiency has increased a certain degree(3)China's logistics industry in most areas is as low level as of the external operating environmentThe optimization of external operating environments would help to improve ML productivity growth of logistics industry in China

Efficiency and Productivity Growth in Indian Banking

Abstract: This article attempts to examine technical efficiency and productivity performance of Indian scheduled commercial banks, for the period 1979–2008. We model a multiple output/multiple input technology production frontier using semi-parametric estimation methods. The endogeneity of multiple outputs is addressed by semi-parametric estimates in part by introducing multivariate kernel estimators for the joint distribution of the multiple outputs and correlated random effects. Output is measured as the rupee value of total loans and total investments at the end of the year. The estimates provide robust inferences about the productivity and efficiency gains due to economic reforms.JEL Classification: E23, G21, D24

An assessment of the productivity of the Nigerian shipping industry using Saari productivity model

Abstract: This study focal point is the productivity of the Nigerian shipping industry with attention placed on selected twenty-two shipping firms (based on market share) that operate within the country as well as the main seaport in Lagos: the Apapa Port Complex. Data on productive inputs and outputs were collected via the administration of questionnaires to the selected shipping companies over two periods within a single year. The periods were: the trough season and the peak season. The outputs consist of throughputs in metric tonnes carried by the companies on their various routes while the inputs were labour, materials, energy and capital served. Saari productivity model, which is based on input/output analysis, was used for data analysis to know each firm’s distribution index of input and output, productivity and productivity index, volume of index output, change of profitability, change of return, change of cost, capacity utilization and so on. It was noted that freight rates and ability to control cost of inputs were significant in the determination of firms’ productivity over a period of time. It was also discovered that the type and mode of operations of shipping firms as well as the use of target marketing matters a lot in its ability to be productive. Key words: Productivity model, productivity index, profitability, capacity utilization.

Improvement and evaluation of intellectual productivity model based on work state transition

Abstract: For optimizing the balance between intellectual productivity and energy use in office buildings, we should reveal the mechanism of intellectual productivity variation of office workers For this purpose, the authors had proposed an intellectual productivity model The model is a state transit model based on short pauses while working This model can explain the productivity variation of most of subject experiment results In some cases, however, the explanation is insufficient with previous 2-state transit model In this study, the authors have proposed an improved model assuming 3 states A subject experiment was conducted where illuminance on the desk and work motivation were controlled to vary their productivity The experimental result was emulated with 2-state/3-state transition models and their accuracies were compared As a result it was confirmed that the 3-state model simulated more accurately It means the 3-state transition model can explain productivity variation better than the 2-state transition model