25 research outputs found
Return to Dollar, Generalized Distance Function and the Fisher Productivity Index
Exploring the duality between a return to dollar definition of profit and the generalized distance function we establish the relationship between the Laspeyres, Paasche and Fisher productivity indexes and their alternative Malmquist indexes counterparts. By proceeding this way, we propose a consistent decomposition of these productivity indexes into two mutually exclusive components. A technical component represented by the Malmquist index and an economical component which can be identified with the contribution that allocative criteria make to productivity change. With regard to the Fisher index, we indicate how researchers can further decompose the Malmquist technical component rendering explicit the sources of productivity change. We also show how the proposed model can be implemented by means of Data Envelopment Analysis techniques, and illustrate the empirical process with an example data set.Generalized Distance Function; Return to Dollar; Fisher and Malmquist Productivity Indexes
Malmquist productivity index decompositions: a unifying framework
In two widely cited but unpublished working papers, Simar and Wilson (1998) and
Zofío and Lovell (1998) proposed an alternative decomposition of the Malmquist Productivity
Index, which retained what seemed to be the strongholds of previous proposals with regard to
the contribution of technological and efficiency change to productivity change. Namely, a
technical change term with regard to the best practice (VRS) technology which is to be found in
Ray and Desli (1997) and a scale efficiency change term that illustrates a firm’s situation with
regard to optimal scale (benchmark technology), Färe, Grosskopf, Norris and Zhang (1994).
Attaining this objective required the introduction of an additional term in the Malmquist
Productivity Index decomposition, which would reflect the scale bias of technical change. It is
our objective to provide economic rationale for this term within a theory of production context,
the existing decompositions and recent articles that further elaborate on this issue. The ideas are
illustrated using productivity trends in 17 OECD countrie
Return to dollar, generalized distance function and the fisher productivity index
Exploring the duality between a return to dollar definition of profit and the
generalized distance function we establish the relationship between the Laspeyres, Paasche
and Fisher productivity indexes and their alternative Malmquist indexes counterparts. By
proceeding this way, we propose a consistent decomposition of these productivity indexes
into two mutually exclusive components. A technical component represented by the
Malmquist index and an economical component which can be identified with the
contribution that allocative criteria make to productivity change. With regard to the Fisher
index, we indicate how researchers can further decompose the Malmquist technical
component rendering explicit the sources of productivity change. We also show how the
proposed model can be implemented by means of Data Envelopment Analysis techniques,
and illustrate the empirical process with an example data set
Urban patterns, population density and optimal city dimension: The case of public infrastructure
Determination of the optimal city size underlies the economic rationality of infrastructure provision by local governments. We investigate the existence of decreasing average costs resulting from economies of scale, associated with larger urban dimensions in terms of population and housing, and economies of density, brought about by reductions in urban dispersion, and calculate optimal population densities when providing basic infrastructure. The methodology relies on novel definitions of scale and density economies and their estimation by way of flexible translog cost functions, extensively applied in the literature dealing with the provision of services—i.e., utilities, but extended here to their supporting infrastructure. Our results unveil the existence of latent economies of scale and density resulting in a cost excess in the provision of infrastructure due to the effect of urban sprawl that translates into suboptimal city sizes. Based on these findings several policy guidelines rationalizing urban development are suggested. The model is illustrated using Spanish statistical data collected from the nationwide local infrastructure and equipment survey, and prices from a new database that uses engineering cost benchmarks.Urban patterns; Optimal urban density; Scale and density economies; Translog cost function.
The measurement of profit, profitability, cost and revenue efficiency through data envelopment analysis: A comparison of models using BenchmarkingEconomicEfficiency.jl
We undertake a systematic comparison of existing models measuring and decomposing the economic efficiency
of organizations. For this purpose we introduce the package BenchmarkingEconomicEfficiency.jl for the
open-source Julia language including a set of functions to be used by scholars and professionals working
in the fields of economics, management science, engineering, and operations research. Using mathematical
programming methods known as Data Envelopment Analysis, the software develops code to decompose
economic efficiency considering alternative definitions: profit, profitability, cost and revenue. Economic
efficiency can be decomposed, multiplicative or additively, into a technical (productive) efficiency term and
a residual term representing allocative (or price) efficiency. We include traditional decompositions like the
radial efficiency measures associated with the input (cost) and output (revenue) approaches, as well as
new ones corresponding to the Russell measures, the directional distance function, DDF (including novel
extensions like the reverse DDF, modified DDF, or generalizations based on Hölder norms), the generalized
distance function, and additive measures like the slack based measure, their weighted variants, etc. Moreover,
regardless the underlying economic efficiency model, many of these technical inefficiency measures are
available for calculation in a computer software for the first time. This article details the theoretical methods
and the empirical implementation of the functions, comparing the obtained results using a common dataset
on Taiwanese BanksJosé L. Zofío thanks the grant PID2019-105952 GB-I00 funded by
Ministerìo de Ciencia e Innovación/ Agencia Estatal de Investigación
/10.13039/50110001103
The Multiregional Core-periphery Model: The Role of the Spatial Topology
This version of the article has been accepted for publication and is subject to Springer Nature’s AM terms of use, but is not the Version of Record and does not reflect post-acceptance improvements, or any corrections. The Version of Record is available online at: https://doi.org/10.1007/s11067-015-9285-7We use the multiregional core-periphery model of the new economic geography to analyze and compare the agglomeration and dispersion forces shaping the location of economic activity for a continuum of network topologies — spatial or geographic configuration — characterized by their degree of centrality, and comprised between two extremes represented by the homogenous (ring) and the heterogeneous (star) configurations. Resorting to graph theory, we systematically extend the analytical tools and graphical representations of the core-periphery model for alternative spatial configuration, and study the sustain and break points. We study new phenomena such as the infeasibility of the dispersed equilibrium in the heterogeneous space, resulting in the introduction of the concept pseudo flat-earth as a long-run equilibrium corresponding to an uneven distribution of economic activity between region
Using the economic theory of index numbers to decompose the road freight generalized transport costs
La importancia de los costes del transporte a la hora de analizar
aspectos relacionados con la accesibilidad económica y geográfica, los flujos interregionales
de comercio, o la localización territorial y especialización productiva,
es indudable en la actualidad. Muchos trabajos se han dedicado con éxito a la definición
y medición de estos costes del transporte desde un punto de vista estático.
Sin embargo, la literatura especializada aún carece de una metodología adecuada
para su cálculo dinámico a través del tiempo. Por esta razón, este trabajo mejora el
marco metodológico existente para medir correctamente las variaciones temporales
en los costes del transporte. Para ello usamos la teoría económica de los números
índice y gracias a ella descomponemos de forma precisa los efectos que tienen
sobre los cambios en los costes del transporte tanto las variables de tipo económico
(precios) como relacionadas con la red de infraestructuras.The importance of the transport costs for micro and macro geographical
analyses regarding economic accessibility, interterritorial trade patterns,
or regional localization and productive specialization, is nowadays paramount.
Many studies have been devoted to defining and measuring transport costs from the point of view of a static cross-section perspective. However, when it comes to
characterizing their evolution time, a suitable dynamic framework has not been yet
presented. In this context, the contribution of this note consists on improving the
existing methodology to accurately measure the change in generalized transport
costs over time within the economic theory approach to index numbers and, by
doing so, provide a consistent decomposition of these changes that allows us to
determine precisely the effects that both economic and infrastructure determinants
have on transport costs variation.Apoyo financiero obtenido de la Dirección General de Universidades e Investigación de
la Comunidad de Madrid (Progrrama S2007-HUM-0467, www.uam.es/transportrade), del Ministerio de
Fomento (P42/08, www.proyectodestino.es), y el Ministerio de Ciencia e Innovación (ECO2010-21643)
Trade margins, transport cost thresholds and market areas: municipal freight flows and urban hierarchy
Recent research has determined the existence of a border effect on trade flows within a
country associated to agglomeration economies, the size of the spatial unit of reference, as
well as to alternative measures of transport costs. Using a micro-database on road freight
shipments within Spain for the period 2003-2007, we consistently decompose the total value
of municipal freight flows into the extensive and intensive margins at the European Nuts-5
(municipal), 3 (provincial) and 2 (regional) levels and study the impeding effect of actual
generalized transport costs (as opposed to proxies given by the standard measures of distance
and travel time). Establishing the superiority of this generalized measure of transport
costs, we confirm the accumulation of trade flows up to a transport cost value of 330 euros,
and conclude that this high density is not explained by the existence of administrative limits
(border effects) but to significant changes in the trade flows-transport costs relationship.
While this high density of trade coincides with low level administrative borders (municipal
and provincial) as there is a positive and significant effect associated to them on all trade
decomposition, it is not significant, or even negative, at a larger regional level. To support
this hypothesis, we identify significant thresholds in the trade flows-transport costs relationship
that are calculated by way of the Chow test of structural change. These breakpoints
allow us to split the sample and control for successive administrative borders in both the
extensive and intensive margins. Relying on these thresholds we define relevant market areas
corresponding to specific transport costs values that portrait a consistent urban hierarchy
system of the largest Spanish cities within a radius of about 330 euros, thereby providing
clear evidence of the predictions made by the central place theory
A panel data toolbox for MATLAB
Panel Data Toolbox is a new package for MATLAB that includes functions to estimate the main econometric methods of balanced and unbalanced panel data analysis. The package includes code for the standard fixed, between and random effects estimation methods, as well as for the existing instrumental panels and a wide array of spatial panels. A full set of relevant tests is also included. This paper describes the methodology and implementation of the functions and illustrates their use with well-known examples. We perform numerical checks against other popular commercial and free software to show the validity of the result
A spatial autoregressive panel model to analyze road network spillovers on production
The production function approach is used to introduce the effect of public infrastructure on economic growth focusing on its spillover effects. We improve the existing literature both from a conceptual and methodological perspective. As regressors we incorporate variables related to the new concepts of internal and imported transport infrastructure capital stocks, which are actually used in commercial flows, calculated by network analysis performed in GIS. The internally used capital stock represents own infrastructure that benefits accessing markets within the region itself, while the imported capital stock captures the spillover effect associated to the use of the infrastructure situated in neighboring regions. From a methodological perspective, we introduce spatial interdependence into these models, applying the most recent spatial econometric techniques based on instrumental variables estimation in spatial autoregressive panel models in comparison with Maximum Likelihood estimation methods. We illustrate the methodology with Spanish provincial panel data for the period 1980–2007. Results support the hypothesis that the imported capital has a positive spillover effect on productio