Natural Decomposition of Total Factor Productivity Growth

Fang, Zhou

doi:10.1142/9789812792457_0007

Cited by 1 publication

(2 citation statements)

References 0 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Allocation e¢ ciency loss u it is impacted by the exogenous environment and policy variable z it . Furthermore, Wang & Gong (2006) point out that variables impacting China's regional allocation e¢ ciency include: human capital level, openness level and proportion of public expenditure. In order to study the threshold e¤ect of the price ‡uctuation on allocation e¢ ciency, this paper further controls the price ‡uctuation P 2 besides the three variables above.…”

Section: Methodsmentioning

confidence: 99%

“…However, in order to avoid bias of uit obtained in the …rst step estimation, uit is assumed to be una¤ected by other variables, or input variable xit is irrelevant to the relative variables in production function equation yit. Obviously, the assumptions of uit are contradictory in two-step estimation above (Wang, Gong, 2006 2. Price ‡uctuation index.…”

Section: Methodsmentioning

confidence: 99%

See 1 more Smart Citation

Impacts of Price Fluctuation on Resource Allocation Efficiency

Congming¹,

Yang²,

Chen³

2012

Economic Research-Ekonomska Istraživanja

View full text Add to dashboard Cite

This paper develops a dynamic model to analyze the e¤ ects of di¤ erent levels of price ‡uctuations on resource allocation e¢ ciency. The model shows two di¤ erent strategies that enterprises adopt when they confront di¤ erent levels of price ‡uctuations. In respond to small ‡uctuations, enterprises might adopt a conservative strategy of maintaining the ratio of factor inputs and leaving production plans unchanged of the adjustment cost. As a result, allocation ine¢ ciency is unavoidable. However, greater ‡uctuations which increase the opportunity cost of a conservative strategy induce enterprises to accept an adjustment strategy; they must change the ratio of factor inputs and the production plans passively. This transformation indicates that a threshold e¤ ect exists in the price ‡uctuations' in ‡uence on resource allocation ine¢ ciency. Using stochastic frontier analysis (SFA) and China's provincial panel data of 1978 to 2007, this paper con…rms that price ‡uctuation has a nonlinear e¤ ect on allocation e¢ ciency loss, and concludes that traditional analyses underestimate the adverse impacts of price ‡uctuation on China's economy.

show abstract

Section: Methodsmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%