Wages and Productivity Growth in a Dynamic Monopoly* This Paper studies the intertemporal problem of a monopolistic firm that engages in productivity-enhancing innovations to reduce its labour costs. If the level of wages is sufficiently low, the firm’s rate of productivity growth approaches the rate of wage growth and eventually the firm reaches a steady state where its unit labour cost remain...

There is strong evidence that exporting firms are better. This correlation can potentially arise from many alternative casual models. In this paper, we utilise the natural experiments offered by transitioning into export in a dataset of Indian firms from 1990 to 2011, where each firm which made the transition is matched against one which did not. While exporting firms become bigger, there is no...

− A theoretical framework is developed for decomposing partial factor productivity and measuring technical inefficiency when the underlying technology is characterized by factor non-substitution. With Farrell’s (1957) radial index of technical inefficiency being inappropriate in this case, Russell’s (1985; 1987) non-radial indices are adapted to measure technical inefficiency in a Leontief mode...

In this paper the time series properties of the outcomes of two different specifications of a nonparametric productivity analysis are compared using data for threeand four-digit U.S. manufacturing industries over the period 1958-96. The first model is standard and does not account for variations of capacity utilization of the production factors whereas the second model does. Correcting for util...

This study explores the reduction potential of greenhouse gases for major pollution emitting countries of the world using nonparametric productivity measurement methods and directional distance functions. In contrast to the existing literature we apply optimization methods to endogenously determine optimal directions for the efficiency analysis. These directions represent the compromise of outp...

This paper provides new evidence that estimates obtained from aggregated data may not provide reliable estimates of average firm-level parameters, if the composition of producers with different levels of productivity changes over the business cycle. I examine plant-level data and show that, due to the countercyclical reallocation of output among heterogenous plants, productivity measures based ...

In this paper we characterize the extent of economic integration between Guangdong, Hong Kong, Macau, and Taiwan (HKMT). We do not find, for the period of 1999 – 2003, consistent evidence that economic activity on the part of HKMT-funded companies contributed to productivity growth in Guangdong domestic manufacturing firms. Furthermore, HKMT-funded companies were less active than Guangdong dome...

We study the ordinal content of assuming supermodularity, including conditions under which a binary relation can be represented by a supermodular function. When applied to revealed-preference relations, our results imply that supermodularity is some times not refutable: A consumer’s choices can be rationalized with a supermodular utility function if they can be rationalized with a monotonic uti...

We describe the evolution of productivity growth in a competitive industry with free entry and exit. The exogenous wage rate determines the firms’ engagement in labor productivity enhancing process innovation. There is a unique steady state of the industry dynamics, which is globally asymptotically stable. In the steady state, the number of active firms, their unit labor cost and supply depend ...

Three dimensions of the performance of firms in Ghana’s manufacturing sector are investigated in this paper: their technology and the importance of technical and allocative efficiency. We show that the diversity of factor choices is not due to a non-homothetic technology. Observable skills are not quantitatively important as determinants of productivity. Technical inefficiency is not lower in f...