1 Introduction.- 1.1 Concepts Underlying Productivity Growth and Capacity Utilization Measures.- 1.2 The Theoretical Relationship Between Productivity and Capacity Utilization.- 1.3 Measurement of Performance Indexes in an Economic Framework.- 1.4 Relationships Among These and Other Indicators of Economic Performance.- 2 The Traditional Measurement of Productivity Growth: Theoretical Issues.- 2.1 Single Factor Measures of Productivity Growth.- 2.2 Accounting Measures of Multifactor Productivity.- 2.3. Adaptations to the Traditional Accounting Framework.- 2.4 The Linkage Between Technical Change and Productivity Growth Measures.- 2.5 The Relationship Between Primal and Dual Measures of Productivity Growth.- 3 The Measurement and Interpretation of Capacity Utilization.- 3.1 An Overview of Standard Measures of Capacity Utilization.- 3.2 Incorporating Economics into Capacity Utilization Measurement.- 3.3 Extensions to the Framework for Capacity Utilization Measurement.- 3.4 Cost-Side or Dual Measures of Capacity Utilization.- 4 Interactions Among Measures of Productivity Growth, Returns to Scale and Capacity Utilization.- 4.1 An Analytical Framework for Decomposing Productivity Growth Measures.- 4.2 The Measurement of Biases with Respect to Technical Change.- 4.3 Extensions to the Theory of Technical Change Biases.- 4.4 The Theory and Interpretation of Utilization and Scale Biases.- 5 Empirical Implementation of Productivity Growth Measures and Adjustments.- 5.1 Nonparametric and Simple Parametric Measurement Methods.- 5.2 The Fundamentals of the Parametric Production Theory Approach.- 5.3 An Overview of the Relevant Duality Theory.- 5.4 Specification of Empirically Implementable Restricted Factor Demand Models.- 6 Data Construction for Estimation and Measurement.- 6.1 Developing Non-Capital Data for Empirical Ìmplementation.- 6.2 Difficult Issues Surrounding Capital Data Construction: The Concepts.- 6.3 Difficult Issues Surrounding Capital Data Construction: A Formalization.- 6.4 Aggregation Issues Arising in Data Construction.- 6.5 Index Numbers and Aggregation.- 7 Issues of Econometric Implementation.- 7.1 The Choice of Functions to Use for Empirical Analysis.- 7.2 Possible Functional Forms to Use for Measurement.- 7.3 Some Econometric Problems to Take into Consideration.- 7.4 Representing Firm Behavior Using the Empirical Estimates.- 8 Empirical Evidence on Productivity Growth and Capacity Utilization.- 8.1 What is the "Productivity Growth Slowdown" and Does it Exist?.- 8.2 A Focus on Energy.- 8.3 The Impact of Capacity Utilization and Scale Adjustments.- 8.4 Biases and Their Contribution.- 9 Other Factors Affecting Productivity Growth: Some Recent Developments.- 9.1 The Impact of Obsolescence on the Measurement of Capital Input.- 9.2 Markups and Their Contribution to the Analysis.- 9.3 Some Views of the Impact of Regulation.- 10 Pulling it Together.- 10.1 A Summary of Economic Performance Indicators and Their Interactions.- 10.2 Interpretation Problems with the Parametric Measures.- 10.3 Some Current Work on Extensions to the Production Theory Framework.- 10.4 Other Important Contributions to the Literature on Economic Performance.- 10.5 Final Remarks.- References.- Author Index.
This text is designed to provide a comprehensive guide to students, researchers, or consultants who wish to carry out and to interpret analyses of economic performance, with an emphasis on productivity growth. The text includes an overview of standard productivity growth measurement techniques and adaptations, and data construc tion procedures. It goes further, however, by expanding the tradition al growth accounting (index number) framework to allow consider ation of how different aspects of firm behavior underlying productivity growth are interrelated, how they can be measured con sistently in a parametric model, and how they permit a well-defined decomposition of standard productivity growth measures. These ideas are developed by considering in detail a number of underlying theoretical results and econometric issues. The impacts of various production characteristics on productivity growth trends are also evaluated by overviewing selected methodological extensions and em pirical evidence. More specifically, in the methodological extensions, emphasis is placed on incorporation of cost and demand characteristics, such as fixity and adjustment costs, returns to scale, and the existence of market power, into analyses of productivity growth. These character istics, generally disregarded in such analyses, can have very important impacts on production structure and firm behavior, and thus on economic performance. They also provide the conceptual basis for vii viii PREFACE measures that are often used independently as indicators of economic performance, such as investment, capacity utilization, and profit measures.
This book provides a comprehensive guide to the analysis of economic performance and productivity growth. It includes an overview of standard productivity growth measurement techniques, and expands the traditional framework to consider how different aspects of the behavior of a firm are interrelated.