efficiency growth and concentration an empirical analysis of hospital markets taking an evolutionary view of markets harold demsetz hypothesized that firms differ persistently in efficiency and that industry concentration results from growth of efficient firms at the expense of inefficient ones we test the hypothesis with high quality microdata from the us hospital industry an industry of keen policy and scientific interest we measure efficiency by firm in the early 1980s and relate it to subsequent growth of efficient firms to the persistence of profit differences and to changes in the concentration of markets initial hospital efficiency and subsequent growth and profitability are significantly and positively related also greater initial variation in hospital efficiency within local markets is positively related to subsequent growth in market concentration these findings support the logic of demsetz s evolutionary efficiency hypothesis though they cannot confirm the stronger idea that variation in firm efficiency is the dominant explanation for changes in concentration

an aggregate consumption function for canada a cointegration approach this study utilizes cointegration theory and error correction models ecms to specify a candidate dynamiac formulation of the aggregate consumption function using quarterly canadian date the variables entering the long run equlibrium relationship are tested for unit roots using a variety of techniques such as the dickey fuller the augemented dickey fuller and the phillips perron test profedures the engle and granger cointegration test and the fully modified consistent and efficient estimator of phillips and hansen are used to estimate the cointegration relationship johansen s maximum likelihood approach is also used to determine the rank of the cointegrating matrix the error correction model which appears to be a tentatively adequate conditional characterization of the date generating process revelas that disposable income wealth government expenditures relative prices and liquidity constraints proxied by the unemployment rate are important variables non nested tests are carried out against

investigating the cost performance of uk credit unions using radial and non radial efficiency measures abstract this paper examines the relative efficiency of uk credit unions radial and non radial measures of input cost efficiency plus associated scale efficiency measures are computed for a selection of input output specifications both measures highlighted that uk credit unions have considerable scope for efficiency gains it was mooted that the documented high levels of inefficiency may be indicative of the fact that credit unions based on clearly defined and non overlapping common bonds are not in competition with each other for market share credit unions were also highlighted as suffering from a considerable degree of scale inefficiency with the majority of scale inefficient credit unions subject to decreasing returns to scale the latter aspect highlights that the uk government s goal of larger credit unions must be accompanied by greater regulatory freedom if inefficiency is to be avoided one of the advantages of computing non radial measures is that an insight into potential over or under expenditure on specific inputs can be obtained through a comparison of the non radial measure of efficiency with the associated radial measure two interesting findings emerged the first that uk credit unions over spend on dividend payments and the second that they under spend on labour costs

tourism demand forecasting models choice of appropriate variable to represent tourists cost of living abstract price is generally regarded as a major determinant of demand tourism has two price elements the cost of travel to the destination and the cost of living for tourists in the destination previous studies where econometric forecasting models have been developed for international tourism demand usually take the consumer price index in a country to be a proxy for the cost of tourism in that country owing to lack of appropriate data this article attempts to evaluate the performance of proxy variables compared with a specific tourists cost of living variable within the context of tourism demand forecasting models

a model of tourism destination choice a theoretical and empirical analysis abstract in recent years tourism has become one of the fastest growing sectors of the world economy and is widely recognised for its contribution to regional and national economic development the main aim of the paper is to propose a methodological framework within which the impact of characteristics of a tourism product on foreign travel can be captured and analysed this is achieved by combining the lancasterian product characteristics approach with the koppelman s consumer transportation model within the proposed model the characteristics of the tourism product destination including quality of service advertising and political instability are combined to generate a perception feeling regarding the tourism destination in the mind of the tourists in order to measure these perceptions feelings and hence develop a preference ordering the model is estimated by utilising a conditional logit analysis the analysis is based on primary data collected from tourists visiting cyprus the conditional logit model generates the probability of revisit given the characteristics of tourists and the cyprus tourism product the paper extends further the lancaster product characteristics framework as applied to tourism by rugg rev econom stat 55 1 1973 64 morley ann tourism res 19 1992 250 and papatheodorou ann tourism res 28 2001 164 by including the neglected but from any viewpoint important political instability characteristic that is attached to the tourist product of cyprus the inclusion of product characteristics attributes in tourism analysis appear to strongly contribute towards the better understanding of travel choice behaviour

the determinants of italian domestic tourism a panel data analysis abstract in this study a gmm panel data estimation is used to investigate the main determinants of italian domestic tourism demand as measured by regional bilateral tourism flows the analysis is developed both at aggregate level and for the two traditional macro areas of the country namely centre north and south for the whole nation the importance of traditional economic variables in determining domestic tourism flows is confirmed however tourist actual choices appear also to be influenced by past experiences and by regional differences in the quality of the wider environment additionally it appears that for italian tourists domestic and international destinations behave as substitutable goods the sub sample analysis highlights some interesting differences between macro areas in particular southern tourists appear more responsive to income variations and less sensitive to prices differentials than their northern counterparts moreover the degree of competition between domestic and outbound trips is higher in the south finally southern tourists seem to be more influenced by environmental attributes while northern tourists are more sensitive to cultural activities

efficiency and environmental factors in the us electricity transmission industry the electricity industry in most developed countries has been restructured over recent decades with the aim of improving both service quality and firm performance regulated segments e g transmission still provide the infrastructure for the competitive segments and represent a significant share of the total price paid by final customers however there is a lack of empirical studies that analyse firms performance in the electricity transmission sector in this paper an empirical analysis of us electricity transmission companies is conducted for the period 2001 2009 we use alternative stochastic frontier models that allow us to identify the determinants of firms inefficiency these models also permit us to control for weather conditions potentially one of the most decisive uncontrollable factors in electricity transmission our results suggest that weather conditions clearly have an influence on transmission costs and that there is room for improvement in the management of us electricity transmission systems regulators should also be aware that more adverse conditions generate higher levels of inefficiency and that achieving long term efficiency improvements tends to worsen firms short term relative performance

school district consolidation market concentration and the scale efficiency tradeoff consolidation is often proposed as a strategy for increasing school district quality without increasing educational funding however if consolidation reduces competition in the local school market and reduces efficiency any savings from exploiting economies of scale may be lost to increased inefficiency we use a stochastic cost function to investigate these effects for districts in texas we find important economies of scale but we also find that increased market concentration leads to increased cost inefficiency finally we illustrate the practical importance of these two potentially offsetting factors in a simulation that considers consolidating texas school districts to county level districts we find that failure to consider the effect on competition can lead to large overestimates of the benefits of consolidation

estimation of input oriented technical efficiency using a nonhomogeneous stochastic production frontier model technical inefficiency can be modeled as either input oriented io or output oriented oo however in the estimation of parametric stochastic production frontier models which use maximum likelihood method only the oo measure is used in this article we consider a simple nonhomogeneous production function and estimate it with both io and oo specifications a sample of 80 spanish dairy data 1993 1998 is used to estimate both models we consider one output liters of milk and four variable inputs viz number of cows kilograms of concentrates hectares of land and labor measured in man equivalent units we find that returns to scale rts and technical efficiency results derived from these models are different because either estimated technologies are different or they are evaluated at different points using a monte carlo analysis we show that if rts is close to unity differences in the estimates of rts and technical efficiency are smaller this holds true for estimates of both rts and technical efficiency

technology invention and diffusion in residential energy consumption a stochastic frontier approach traditional large appliances absorb a large share of residential electricity consumption and represent important targets of energy policy strategies aimed at achieving energy security despite being characterized by rather mature technologies this group of appliances still offers large potential in terms of efficiency gains due to their pervasive diffusion in this paper we analyse the electricity consumption of a set of four traditional white goods in a panel of ten eu countries observed over 21 years 1990 2010 with the aim of disentangling the amount of technical efficiency from the overall energy saving the technical efficiency trend is modelled through a set of technology components representing both the invention and adoption process by the means of specific patents weighted by production and bilateral import flows which allows to overcome the rigid stochastic frontier framework in modelling the effect of technical change our results show that the derived energy demand and inefficiency trends are both related to changes in the amount of available technology embodied in energy efficient appliances the effect is significant both in its domestic and international components and suggests an active role of innovation and trade policies for achieving efficiency targets which directly impact the amount of electricity consumed by households

the diffusion of production processes in the u s banking industry a finite mixture approach abstract this article applies finite mixture distributions to the estimation of cost functions for financial firms through time the mixture approach allows the estimation of multiple technologies when firms technology choices are unobservable technology switching diffusion and underlying technical change are simultaneously evaluated an application to large samples of u s banks for the years 1982 1986 illustrates the approach results suggest banks switch to lower cost production technologies when unburdened by strict branching regulations

a two tiered earnings frontier estimation of employer and employee information in the labor market this pap er develops a two tiered frontier estimation procedure to decompose the residual of an earnings function into three components the first component can be interpreted as being purely random search theory is used to show that the other two components represent employee and employer ignorance of offer and reservation wages respectively relative employee and employer ignorance estimates are presented for various population strata copyright 1987 by mit press

sensitivity analysis of efficiency rankings to distributional assumptions applications to japanese water utilities this article examines the robustness of efficiency score rankings across four distributional assumptions for trans log stochastic production frontier models using data from 1221 japanese water utilities for 2004 and 2005 one sided error terms considered include the half normal truncated normal exponential and gamma distributions results are compared for homoscedastic and doubly heteroscedastic models where we also introduce a doubly heteroscedastic variable mean model and examine the sensitivity of the nested models to a stronger heteroscedasticity correction for the one sided error component the results support three conclusions regarding the sensitivity of efficiency rankings to distributional assumptions when four standard distributional assumptions are applied to a homoscedastic stochastic frontier model the efficiency rankings are quite consistent when those assumptions are applied to a doubly heteroscedastic stochastic frontier model the efficiency rankings are consistent when proper a

market structure and the efficiency of european insurance companies a stochastic frontier analysis abstract this paper is motivated by the progressive liberalisation of the european insurance market in recent years it uses stochastic frontier analysis to estimate flexible fourier cost functions for european insurance companies separate frontiers are estimated for life non life and composite companies we adopt a maximum likelihood approach to estimation in which the variance of both one sided and two sided error terms is modelled jointly with the frontiers this approach allows us to simultaneously control for the impact of heteroskedasticity on the estimation of scale economies as well as estimating the effect of firm size and market structure on x inefficiency the study draws on standard poor s eurothesys data set of financial reports for the period 1995 to 2001 this provides technical and non technical accounts at year end for life non life and composite insurance businesses in 14 major european countries our estimates suggest that over this period most european insurers were operating under conditions of decreasing costs increasing returns to scale and that company size and domestic market share were significant factors determining x inefficiency larger firms and those with high market shares tend to have higher levels of cost inefficiency

evaluating the impact of individual fishing quotas ifqs on the technical efficiency and composition of the us gulf of mexico red snapper commercial fishing fleet this study examines the impact of individual fishing quotas ifqs on the technical efficiency te and composition of the gulf of mexico red snapper commercial fishing fleet employing a parametric stochastic distance frontier framework we find that ifqs improved the te of the vertical line and bottom longline fleets our results suggest that the observed te gains were mainly driven by the retirement of less efficient vessels and to a lesser extent by efficiency gains of the remaining vessels we also document changes in output and input distance elasticities and in returns to scale following the introduction of ifqs the paper also investigates the impact of regulations and weather on productivity and the effect of crowding on te policy implications stemming from these results are also discussed

efficiency and performance in gas distribution evidence from brazil this article analyses the current state of the gas distribution industry in brazil by identifying the main factors that determine its efficiency in order to test the performance of the industry we have calculated the firms technical efficiency during the period 2001 2009 we analyse whether some economic and technological factors as consumer density load factor or regulation among others have affected the performance of this industry we show that companies serving markets with different customer characteristics diversification have reached higher levels of efficiency and evolved faster moreover the private ownership and price cap regulation are more efficient in relation to public ownership and cost of service regulation these findings are important to support the improvement of the regulation of gas distribution in the brazilian states

the effects of macroeconomic stability on foreign trade an analysis for spain 1986 2000 two main factors underlie the rebirth of interest in the study of the influence of the real exchange rate on trade the reduction of its volatility and the current trend towards price stability the objective of this study is to analyse the effects of the process of nominal convergence required of the european member states for the fulfilment of monetary integration on foreign trade flows the case of spain which is especially interesting in this context is studied for the period 1986 to 2000 the results of estimating the aggregate functions of the export and import of goods shows how macroeconomic stability has altered the behaviour of trade with respect to the two basic determinants income and prices how it has caused a significant structural change in the real exchange rate and finally how it has laid the explanatory bases for transactions in the twenty first century with the single currency the euro

systematic departures from the frontier a framework for the analysis of firm inefficiency departures from a production or cost frontier may reflect the systematic effect of conditions that contribute to inefficiency to test whether some portion of frontier function departures can be systematically explained the frontier inefficiency error component is modeled as a function of various causal factors and a random component the functional form of the inefficiency error term model is chosen to assure strict one sidedness preliminary empirical results generated from electric utility data suggest the superiority of including both systematic and random components in the inefficiency error term

forecasting international tourist flows to macau abstract the vector autoregressive var modelling technique is used to forecast tourist flows to macau from eight major origin countries regions over the period 2003 2008 the existing literature shows that the var model is capable of producing accurate medium to long term forecasts and also separate forecasts of the explanatory variables are not required a further justification for using the var technique is that it permits an impulse response analysis to be performed in order to examine the ways in which the demand for macau tourism responds to the shocks in the economic variables within the var system the implications of this analysis are discussed the forecasts generated by the var models suggest that macau will face increasing tourism demand by residents from mainland china since the needs of chinese tourists tend to be different from those from other origin countries regions especially western countries the business sectors in macau need to pay considerable attention to catering for the needs of chinese tourists

a stochastic frontier analysis of financing constraints on investment is shown that investment under financing constraints can be modeled as a one sided deviation from a frictionless investment level and that effects of financing constraints can be identified and quantified by imposing a distributional assumption on the effects panel data on taiwanese manufacturing firms between 1989 and 1996 are used in the estimation it is found that 1 some of the sorting criteria used in the literature do not have significant and monotonic relationships with the degrees of financing constraint resulting in problematic sample separations and 2 the effects of financial liberalization in taiwan are such that the investment efficiency improved over time for a typical firm and the improvement was particularly large for smaller firms

a tourism demand function for the okanagan bc abstract this study examines the relative importance of the existing determinants of tourism demand in the okanagan because national coefficients cannot be used intercnageable with regional coefficients it is hypothesized that the values of the okanagan demand elasticities are likely to be lower than that of the province and the nation five major markets for okanagan tourism with identified and separate regressions run to determine the relative importance of the determinants of demand for okanagan tourism with respect to these markets empirical results indicate that national coefficient will tend to overestimate the regional coefficient values contrary to the results of other studies for the nation as a whole the exchange rate and travel cost did not seem to be significant determinants of okanagan tourism receipts

on error correction models specification interpretation estimation abstract error correction models ecms have proved a popular organising principle in applied econometrics despite the lack of consensus as to exactly what constitutes their defining characteristic and the rather limited role that has been given to economic theory by their proponents this paper uses a historical survey of the evolution of ecms to explain the alternative specifications and interpretations and proceeds to examine their implications for estimation the various approaches are illustrated for wage equations by application to uk labour market data 1855 1987 we demonstrate that error correction models impose strong and testable non linear restrictions on dynamic econometric equations and that they do not obviate the need for modelling the process of expectations formation with the exception of a few special cases both the non linear restrictions and the modelling of expectations have been ignored by those who have treated ecms as merely reparameterisations of dynamic linear regression models or vector autoregressions

heteroscedasticity or production risk a synthetic view two veins of literature namely production risk literature and stochastic frontier analysis are examined both fields are concerned of output variation the former due to exogenous shocks the latter due inefficiency by covering the literature from both the fields this review suggests that the concept of heteroscedasticity can be utilized to build a synthesis between these mainly separate branches of literature however the synthetic approach brings a challenge how to differentiate between different sources of output variation this challenge is identified as the main obstacle to meaningfully combine the two approaches

the demand for tourism in north east england with special reference to northumbria an empirical analysis abstract this paper examines the trends of tourism in north east england in particular we focus on the area of northumbria to show the potential of tourism for economic development in the region within this analysis we concentrate on the demand for tourism in the region and in particular we are concerned with tourism by uk residents in northumbria domestic tourism the long run relationship between domestic tourism demand and a number of economic factors effecting this demand is considered using the johansen and juselius 1990 1992 multivariate cointegration analysis an error correction model is then proposed for short run forecasting of domestic demand for tourism in northumbria

innovative performance effects of institutional quality an empirical investigation from the triad using data for a set of 823 r d intense manufacturing firms within the triad and the quality of government qog dataset over the 2002 2010 period this article investigates the effects of institut

technical efficiency in the italian performing arts companies this paper evaluates the determinants of firms technical efficiency in the italian performing arts pa sector by estimating a stochastic production frontier for an unbalanced panel of 107 firms over the period 2005 2012 the panel data setting allows us to control for both unobserved and observed heterogeneity of pa firms reaching several interesting and robust findings firstly it finds that the italian pa firms are scale inefficient as they generally operate in either an increasing or decreasing returns to scale landscape this result is reinforced by the fact that the smaller firms 10 49 employees are the most technically efficient firm size class secondly this research proves that the efficiency score is on average 66 demonstrating that pa firms output could be substantially increased without the use of new inputs thirdly it confirms that the quality matters and competences increase the efficiency in the sector finally the environmental factors especially the quality of institutions have a strong impact on technical efficiency of pa firms supporting that regional differences also exist in this sector

the effects of government expenditure on imports in the eurozone reconsidered evidence from panel data abstractthis study examines the impact of government expenditure on imports the empirical analysis is based on annual data of the euro area countries for the period 1995 2015 we employ econometric methods that mitigate heterogeneity and cross sectional dependence we provide empirical indications that the components of expenditure have different impact on imports demand the findings of this study indicate that the import context of government expenditure is lower than the import context of others expenditure components finally we find that an increase in government expenditure leads to an increase in imports this implies that ceteris paribus that it can lead to a deterioration of the trade balance

costs of nitrogen runoff for rural water utilities a shadow cost approach this paper explores the interactions among scale and density economies productive efficiency water quality and customer characteristics and their impact on the costs of delivering treated drinking water implicit benefits of nitrogen abatement are also derived and hypothesis tests concerning their hypothesized drivers are conducted key findings are that nitrogen removal costs increase with rising raw water nitrogen concentration coming from agricultural activities and that network density and system size matter in determining average total costs of community water systems merging water systems to take advantage of scale economies may be difficult due to the heterogeneity of the sector however

determinants of demand for international tourist flows to turkey abstract this article describes the development and findings of a set of models used to identify the most important of the following selected variables influencing international tourist flows to turkey per capita income relative prices relative exchange rate promotional expenditure the turkish government has invested a substantial amount in promoting foreign tourism and special events eg political unrest the demand for travel was measured both by the number of tourists and by the total tourist expenditure data were obtained from secondary sources and analysis was by least squares multiple regression income price and exchange rate were found to be important factors but the impact of promotional expenditure was minimal

do farmers choose to be inefficient evidence from bicol abstract farming households that differ in their ability or willingness to take on risks are likely to allocate resources and effort among income producing activities differently with consequences for productivity in this paper we measure voluntary and involuntary departures from efficiency for rice producing households in the bicol region of the philippines we take advantage of a panel of observations on households from 1978 1983 and 1994 available monthly weather data and survey information on planting times allows us to create household specific measures of weather shocks which we use in our analysis we find evidence that diversification and input choices do affect efficiency outcomes among farmers although these effects are not dominant accumulated wealth past decisions to invest favorable market conditions and propitious weather are also important determinants of efficiency outcomes among bicol rice farmers our findings suggest that the costs of incomplete formal and informal insurance markets are higher for poorer farmers

fuel poverty and well being a consumer theory and stochastic frontier approach abstract evidence and conventional wisdom suggest that general poverty has a negative effect on the well being of individuals however the mechanisms through which this effect occurs are not well understood through economic approach in this paper we analyse the influence of general and fuel poverty as well as the social dimension through peer comparison on the subjective well being of households we develop a novel approach to analyse fuel poverty and well being based on consumer theory individual preferences are modelled using indifference curves and a distance function where the preferences of individuals are affected by their poverty status we use the survey data from the official spanish life condition survey for 2013 which contains over 16 608 observations on household members the results show that both general and fuel poverty influence the reference indifference curve but that individuals also compare themselves with their peers the proposed model also allows us to corroborate how general and fuel poverty affect well being and how effective policies can be designed to improve social welfare

farmers health and agricultural productivity agriculture is one of the most hazardous productive sectors around the world most previous studies have focused on health issues of farmers in developing countries while little attention has been paid to farmers health problems in developed countries the present study assesses the effect of farmers health conditions on agricultural productivity in norway employing stochastic frontier regression techniques we conclude that differences in farmers health help to explain the variance in agricultural production efficiency

fiscal policy the real exchange rate and traded goods we estimate the effects of government spending shocks on the cpi real exchange rate the trade balance and their co movements with gdp and private consumption we decompose the variations of the cpi real exchange rate into variations of the traded goods real exchange rate and the relative price of traded to non traded goods we reach three main conclusions a rise in government spending induces a depreciation of the cpi real exchange rate and a trade balance deficit private consumption rises in response to a government spending shock and therefore co moves positively with the real exchange rate both components of the cpi real exchange depreciate we employ vector auto regression var techniques to estimate the effects of fiscal policy and in particular government spending on the cpi real exchange rate and the trade balance in the us and three other oecd countries our empirical analysis delivers two key results first a rise in government spending tends to induce a real exchange rate depreciation and a trade balance deficit although especially in the us the latter effect tends to be small second in all countries private consumption rises in response to a government spending shock and therefore co moves positively with the real exchange rate two important implications follow from these results our evidence provides support for a traditional twin deficit hypothesis in stark contrast with a recent study by kim and roubini 2008 a second implication concerns the consistency of facts and theory both the response of the real exchange rate and its co movement with private consumption and the trade balance are at odds with a benchmark general equilibrium open economy model featuring complete financial markets in fact while the model is successful in replicating the negative response of the trade balance to a government spending shock that we observe in the data and also in linking the magnitude of that response to the degree of openness it has counterfactual predictions on the response of the real exchange rate and of private consumption we argue that the key failure of the model lies in the equilibrium behaviour of private consumption in the model as a result of a typical wealth effect on labour supply private consumption falls in response to a rise in government spending whereas the opposite is true in the data this in turn explains the behaviour of the real exchange rate in the reference model with complete asset markets a risk sharing arbitrage condition ties the ratio of the marginal utilities of consumption across countries to the real exchange rate via this condition and provided that deviations from purchasing power parity are feasible the fall in consumption is accompanied by an equilibrium appreciation of the real exchange rate we proceed by investigating further the sources of the cpi real exchange rate movements in the data a traditional approach decomposes the real exchange rate into two terms

predicting technical effciency in stochastic production frontier models in the presence of misspecification a monte carlo analysis this paper provides a theoretical explanation for the sensitivity of technical efficiency measures to the choice of functional specification in stochastic production frontier models it is shown that inappropriate functional specifications translate into a misspecification in the conditional mean of the stochastic frontier regression model this misspecification in turn results in estimates of technical efficiency confidence intervals and production elasticities being biased even asymptotically monte carlo simulations reveal that the severity of the bias depends on the functional specification and the percentage contribution of the variance of technical inefficiency to the total variance of the composed errors

a multiproduct cost study of savings and loans this paper investigates the cost structure of savings and loans most studies of financial institutions have failed to take into account the multiproduct nature of these institutions using the multiproduct approach the existence of subadditivity multiproduct global and product specific economies of scale and scope and substitutability between inputs is investigated a translogarithmic cost function is estimated using 1982 data on california savings and loans restrictive functional forms also estimated are rejected standard errors for the statistics calculated are estimated and various statistical tests are conducted previous authors have not calculated standard errors for these statistics no evidence of subadditivity in the industry is found in order to investigate the impact of deregulation on the financial services industry it is necessary to know the cost structure of the industry optimal firm size and product mix can be determined once the structure is known the presence of scale economies would imply that smaller firms or entering firms that operate at a small scale would be at a cost disadvantage compared with larger established firms a finding of economies of scope i e economies of joint production would imply that firms that were specialized would be at a cost disadvantage and that regulations that restrict the outputs a firm is allowed to produce may lead to inefficient production

the potential estimation and factor analysis of china s energy conservation on thermal power industry new huadu business school research fund national social science foundation of china 12zd059 ministry of education 10gbj013

determinants of bank cost efficiency in transition economies evidence for latin america central and eastern europe and south east asia in this study we adopt wang s 2002 heteroscedastic stochastic frontier model which allows us to investigate bank cost efficiency and to measure the marginal effects of some variables on both the level and the variability of inefficiency in recent years the financial crisis has significantly affected the banking systems of the transition countries hence the efficiency is of major importance for the stability of the banks regarding the determinants of efficiency we find evidence that banks that follow a more cautious strategy characterized by lower risk appetite and average expectations on profitability have higher cost efficiency we also find that traditional deposit taking and loan making still remain the most efficient activity of the banks additionally the results showed that a higher gross domestic product growth rate implies an increase in the inefficiency level indicating an unsustainable bank management behaviour which in periods of economic growth adopts policies that can generate

analysing wage differentials when workers maximize the return to human capital investment abstractthe analysis of the determinants of differences in wages across workers has traditionally relied on the estimation of average earnings functions in this article we propose a new theoretical model where it is the workers who decide the amount they wish to invest in human capital taking into account the costs of acquiring those skills for the purpose of maximizing earnings in this model both human capital and marginal productivity are likely to be influenced by the individual s unobserved characteristics such as ability or motivation potentially giving rise to endogeneity problems in this context the empirical implementation of our theoretical model allows us under certain assumptions to obtain consistent estimates even under the assumption of endogeneity we present an empirical application to the education sector using data from the spanish structure of earnings survey 2010 our results show that females and workers in the private education sector face more difficulties in achieving t

the performance of german water utilities a semi parametric analysis germany s water supply industry is characterized by a multitude of utilities and widely diverging prices possibly resulting from structural differences beyond the control of firms management but also from inefficiencies in this article we use data envelopment analysis and stochastic frontier analysis to determine the utilities technical efficiency te scores based on cross sectional data from 373 public and private water utilities in 2006 we find large differences in te scores even after accounting for significant structural variables like network density share of groundwater usage and water losses

a synoptic view of regional growth and unemployment i the neoclassical theory this paper is the first part of a consideration of the implications of the current controversies in macroeconomics for regional growth theory it is concerned with the neoclassical explanation of d

estimating technology in the postal sector a bayesian approach abstractthe aim of this article is to study the technology of the sector represented by the spanish national post office and telegraph service sociedad estatal correos y telegrafos s a trading as correos and denominated as such hereafter concretely we analyse economic efficiency technical and allocative and scale economies of the production units cost centres of correos to do this we employ a methodology based on an input distance function which is the dual of the cost function moreover and applying duality theory we develop an economic model to assess the effect of postal infrastructures on the operators costs in order to carry out the empirical model bayesian econometrics is applied to estimate the parameters in the input distance function and the technical and allocative efficiency terms

a note on the estimation of import trade demand functions this paper compares six alternative methods of computing the import demand function we use a sample of 33 countries from 1995 1 to 2016 3 and brand new information on import contents made available by wiod preferred models take into account the separate effects of each final demand component contrary to some recent studies we observe that private expenditure is the main driver of import variations

long run money demand function in argentina during 1935 1962 evidence from cointegration and error correction models this paper provides a study of argentina s money demand function during 1935 62 and 1946 62 these priods not only involved several important changes in argentina s economy and banking system but also included high and volatile inflation using cointegration tests and error correction moderlling results shows that even in periods of large variability there exists a stationary long run demand function for real m1 and real m2 in argentina error correction models show that there is biddirectional causality between real money stock m1 and m2 and the rate of inflation in both periods real income is found to be exogenous in all relationships thus results presented in this paper provide merit to cagan s form of money demand function during high inflation periods

cointegration and unit roots this paper provides an updated survey of a burgeoning literature on testing estimation and model specification in the presence of integrated variables integrated variables are a specific class of non stationary variables which seem to characterise faithfully the properties of many macroeconomic time series the analysis of cointegration develops out of the existence of unit roots and offers a generic route to test the validity of the equilibrium predictions of economic theories special emphasis is put on the empirical researcher s point of view

a comprehensive analysis of the effects of risk measures on bank efficiency evidence from emerging asian countries this study investigates the role of risk in determining the cost efficiency of international banks in eight emerging asian countries researchers of this paper consider three distinct risk aspects under a total of eight risk measures credit risk operational risk and market risk we apply a heteroscedastic stochastic frontier model to estimate bank cost efficiency in our analysis additionally this study analyzes the marginal effects of all risk measures on the inefficiency effect in order to explore a more detailed relationship between risks and efficiency the empirical results indicate that the risk measures represent significant effects on both the level and variability of bank efficiency we also find that these effects vary across countries and over time

the measurement of efficiency in life insurance estimates of a mixed normal gamma error model abstract this paper make three contributions to the literature on efficiency in financial services first it presents estimates of a mixed error cost frontier in which the variances of both the normal and gamma distributions can vary with firm size second it extends the literature on life insurance scale and product mix economies by incorporating and measuring x inefficiency estimates of x inefficiency range from 35 to 50 ray scale economies exist up to 15 billion in assets third comparisons of normal gamma estimates with other methods 3 thick frontier weighted least squares half normal distributions 3 demonstrate some of their pitfalls

an integrative approach to tourism demand forecasting abstract tourism demand forecasting has become an end in itself with the forecasting process being divorced from the tourism management activities it is supposed to serve this article argues that a combination of techniques should be employed in order to facilitate a more meaningful dialogue between analysts and those responsible for tourism management decisions the emphasis placed on econometric modelling has the potential to create significant blind spots in our vision of the future the failure of this approach to enhance our understanding of phenomena which are more amenable to modes of analysis based on alternative paradigms such as chaos theory has contributed to mixed results in the past an approach to forecasting and strategic planning being developed by the australian tourist commission is used as a case study to illustrate aspects of the integrative approach that is advocated

a sectoral explanation of per capita income convergence and divergence estimating verdoorn s law for countries at different stages of development this paper estimates the verdoorn law the relationship between productivity and output growth for manufacturing industries for 70 developed and developing countries it tests the hypothesis that the various manufacturing industries exhibit different values of the verdoorn coefficient and hence different degrees of increasing returns broadly defined the paper analyses especially whether or not these estimates vary according to the level of a country s economic development controlling for such factors as human capital and the level of technology it is found that this is the case countries in the early stages of development would benefit from specialising in low tech manufacturing and consumption goods as these industries have larger verdoorn coefficients than in the more developed countries however as countries reach higher stages of development it is advantageous for them to specialize in the high tech manufacturing industries and the capital goods industries these have relatively high values of the verdoorn coefficient compared with the less developed countries it is concluded that the composition of industries that leads to the fastest growth of manufacturing productivity differs depending upon the level of economic development

government policy and agricultural productivity in indonesia we focus on the agricultural productivity implications of the complex of investment price and research policies the indonesian government has employed since the end of the green revolution in particular we employ a new 1985 2005 provincial panel dataset together with a stochastic output distance frontier framework to examine how government policies have affected the nation s agricultural productivity decomposing it into its technical progress and efficiency components government s primary contributions to technology growth have come through price and trade policies rather than public research most technology growth however appears to be due to informal technology diffusion copyright 2010 oxford university press

frontier estimation and firm specific inefficiency measures in the presence of heteroscedasticity the purpose of this article is to illustrate a straightforward and useful method for addressing the problem of heteroscedasticity in the estimation of frontiers a heteroscedastic cost frontier model is developed and estimated using bank cost data similar to that used by ferrier and lovell our results show dramatic changes in the estimated cost frontier and in the inefficiency measures when accounting for heteroscedasticity in the estimation process we find that the rankings of firms by their inefficiency measures is affected markedly by the correction for heteroscedasticity but not by alternative distributional assumptions about the one sided error term

a regional equilibrium growth model and its disequilibrium dynamics a one sector approach girardi r and paelinck j h p 1994 a regional equilibrium growth model and its disequilibrium dynamics a one sector approach reg studies 28 305 317 this paper deals with the problem of regional disequilibria its central concern is the derivation of an equilibrium and a disequilibrium growth model based on the concept of location elasticities the equilibrium model is based on the general idea that the production of a region for a given sector would be in equilibrium if every regional firm has located efficiently according to the regional location factor profile the disequilibrium model is developed assuming an adaptation process towards equilibrium the model explains growth as the sum of an equilibrium and a disequilibrium component the condition for a regional equilibrium growth pattern shows that adaptation is more difficult for regions with a small share of production because they have to follow a pattern of growth defined by regions with higher shares the disequilibrium model also hi

aggregate imports and expenditure components in the uk an empirical analysis this paper examines the long run relationship between uk aggregate imports and the macroeconomic components of final expenditure using the johansen multivariate cointegration analysis it is found that there are significant differences between the long run elasticities of import demand with respect to the different components of final expenditure over the period 1972 to 1990 an error correction model is proposed for short run forecasting of uk aggregate imports the short run model appears to track the data well

fdi performance a stochastic frontier analysis of location and variance determinants the opening up process of the eastern european countries was marked by greater integration of fdi with their western neighbouring countries using the single step ml approach to stochastic frontier analysis the location and variance determinants of fdi are estimated using the knowledge capital kk model framework the findings based on a panel of bilateral fdi stocks from 10 western to 10 eastern european countries over the 1996 2007 period suggest fdi is determined by both horizontal and vertical motives while the process of liberalization and infrastructural developments significantly reduces the variance of fdi in using a stochastic frontier specification of the kk model the efficiency of fdi performance is identified relative to maximum levels the bilateral efficiency scores suggest a mixed performance indicating scope to improve the efficiency of fdi

economic growth kaldor s laws and the static dynamic verdoorn law paradox 1982 economic growth kaldor s laws and the static dynamic verdoorn law paradox applied economics vol 14 no 3 pp 279 294

the estimation of frictional unemployment a stochastic frontier approach this paper reports an estimate of the frictional unemployment rate in u s manufacturing that is derived from a parametric statistical method for estimating stochastic frontiers the steady state perfect foresight solution to an estimated employment growth frontier provides a locus of technically efficient frictional rates of unemployment the mean frictional unemployment rate during the sample period is estimated to be 3 7 percent of the manufacturing labor force this estimate conforms closely to an estimate of 3 5 percent that is derived from manufacturing sector data presented by david m lilien 1980 for roughly the same time period copyright 1991 by mit press

a note on savings and loan ownership structure and expense preference a re examination this study extends the work of akella and greenbaum journal of banking finance 12 1988 419 through the use of a much larger nationwide sample of us saving and loan associations and supports their original finding of significant expense preference behavior in mutual savings and loans during their original study period 1979 80 this study also provides evidence that over the time period of substantial deregulation and changes in the competitive environment in the us financial services industry expense preference behavior for savings and loans decreased the results are consistent with the idea that the removal of barriers that restrict competition should improve managerial efficiency in firms that survive 2003 elsevier b v all rights reserved

the impact of farmers health and nutritional status on their productivity and efficiency evidence from ethiopia this article focuses on the link between agricultural productivity and health and nutrition status of peasants in ethiopia the data come from the first round of the ethiopian rural household survey conducted in 1994 the sites selected were those in which farmers practice ox plow cultivation of cereals a stochastic frontier approach was adopted for the agricultural production the findings of the study show that the distance to the source of water as well as nutrition and morbidity status affect agricultural productivity the market wage rate is also very responsive to the weight for height as well as the body mass index and height in a context where separability between consumption and production decisions of the household is rejected elasticities of labor productivity with respect to nutritional status are noted to be strong and similar in technology estimates and wage equations moreover returns to investment in nutrition are clearly high in the ethiopian context overall the results indicate substantial loss in output due to technical inefficiency even after accounting for the health and nutrition of workers

biases in frontier estimation due to heteroscedasticity abstract this paper investigates the effects of heteroscedasticity on the parameters in frontier regression models a monte carlo experiment is employed to determine that heteroscedasticity leads to overestimation of the intercept and underestimation of the slope coefficients

quality frontier of electricity distribution supply security best practices and underground cabling in finland electricity distribution is a prime example of local monopoly in most countries the costs of electricity distribution operators are regulated by the government however the cost regulation may create adverse incentives to compromise the quality of service to avoid this cost regulation is often amended with quality incentives this study applies theory and methods of productivity analysis to model the frontier of service quality a semi nonparametric estimation method is developed which does not assume any particular functional form for the quality frontier but can accommodate stochastic noise and heteroscedasticity the empirical part of our paper examines how underground cabling and location affect the interruption costs as expected higher proportion of underground cabling decreases the level of interruption costs the effects of cabling and location on the variance of performance are also considered especially the location is found to be a significant source of heteroscedasticity in the interruption costs finally the proposed quality frontier benchmark is compared to the current practice of finnish regulation system the proposed quality frontier is found to provide more meaningful and stable basis for setting quality targets than the average practice benchmarks currently in use

twin deficit or twin divergence fiscal policy current account and real exchange rate in the u s abstract in spite of concerns about twin deficits fiscal and the current account deficits for the united states economy empirical evidence suggests that twin divergence is a more usual feature of the historical data i e when fiscal accounts worsen the current account improves and vice versa this paper empirically studies the effects of fiscal policy government budget deficit shocks on the current account and the real exchange rate during the flexible exchange rate regime period based on var vector auto regression models we identified exogenous fiscal policy shocks after controlling for business cycle effects on fiscal balances in contrast to the predictions of most theoretical models the u s results suggest that an expansionary fiscal policy shock or a government budget deficit shock improve the current account and depreciate the real exchange rate increases in private savings and declines in investment contribute to the current account improvement while a nominal exchange rate depreciation as opposed to a relative price level change is mainly responsible for the real exchange rate depreciation the twin divergence of fiscal balances and current account balances is also explained by the prevalence of output shocks i e output shocks more than fiscal shocks appear to drive the co movements of the current account and the fiscal balance

international tourism demand models inclusion of marketing variables abstract national tourist organizations often spend considerable sums in foreign countries on promoting the particular country as a tourist destination only seldom however is marketing activity incorporated as an explanatory variable in models of the demand for international tourism in such cases it should be possible to assess the impact of promotional expenditure in terms of the tourist visits and tourist expenditure generated where marketing is used to explain international tourism demand caution must be exercised in interpreting the empirical results poor results cannot be used to reach sensible conclusions and when good results are obtained the full implications of the estimated coefficients need to be explored

are women better bankers to the poor evidence from rural microfinance institutions microfinance institutions mfis provide financial services to the poor and in many ways resemble both banks and non profit organizations many mfis target women because more women than men are poor especially in rural areas studies show that women manage money differently from men and have different leadership styles thus in credit unions and financial firms female and male managers achieve different results in microfinance gender diversity on the board of mfis is beneficial and loans authorized by female loan officers have lower default rates motivated by these findings we ask whether mfis with a female chief executive officer ceo are more efficient at serving the poor without jeopardizing financial sustainability we adapt the banking approach to managerial in efficiency to account for the outreach and sustainability goals of the mfis and evaluate whether mfis outreach efficiency differs by the gender of their respective ceos we estimate a stochastic frontier cost function using the battese coelli 1995 model and the true random effects estimators using panel data from over 250 mfis we find that mfis with female ceos have significantly higher outreach efficiency than mfis with male ceos similar results are found with a two step stochastic frontier approach overall the results suggest that promoting gender diversity at the top levels of mfi management is likely to have both social and financial benefits

estimation of a doubly heteroscedastic stochastic frontier cost function this article extends the results obtained by caudill ford and cropper in estimating and testing stochastic frontier cost functions in the presence of heteroscedastic inefficiency using cross section data it suggests the estimation of the model under the assumption of heteroscedasticity in both random terms this avoids any possible misspecification bias and the use of incorrect tests the same data as used by caudill et al supports the new specification moreover we find that firm specific inefficiency measures are extremely sensitive to the proposed correction for heteroscedasticity

the functional form of the aggregate import demand equation italy 1960 1980 abstract the authors investigate the functional form of the aggregate import demand equation in italy by using the box and cox transformation and a non linear full information maximum likelihood procedure instead of the two step procedure usually followed

evaluating research and education performance in indian agricultural development india s agricultural research spending has long been regionally uneven regional research intensity ratios which account for size differences indicate research spending has consistently favored southern and western states over northern central and eastern ones farm production patterns have however changed in recent years and regional output growth is being driven by new commodity mixes in this paper we ask which region had the highest factor productivity growth and rate of return to investments in public agricultural research and higher education our analysis relies on a 1980 2008 indian agricultural production and policy dataset together with a dual heteroscedastic production frontier to decompose total factor productivity tfp growth into formal technical progress and efficiency elements the model s regional flexibility affords region to region comparison of multiple research return rates tfp growth and the elements influencing them regardless of return rate measure or allocation scenario evaluated the north has enjoyed the highest return to research spending and the central and east the lowest factor productivity growth has however been strongest in the south primarily on account of efficiency gains overall though the technical progress and productivity growth easily attributable to government supported research has been rather low this article is protected by copyright all rights reserved

cointegration and dynamic time series models abstract this paper provides a survey of some of the recent developments in the field of econometric modelling with cointegrated time series in particular we describe the testing and estimation procedures which have become increasingly popular in the recent applied literature in addition to the two stage procedure proposed by engle and granger we consider extensions to the modelling of dynamic models with cointegrated variables such as the estimation of models with multiple cointegration vectors simultaneous systems models with seasonally integrated and cointegrated variables furthermore we illustrate the practical application of the techniques describes in the paper by means of a tutorial data set

which microfinance institutions are becoming more cost effective with time evidence from a mixture model italian speakers tend to stress the second component of german morphologically complex words such as compounds and prefix verbs even if the first component is lexically stressed to improve their prosodic phrasing an automatic pronunciation teaching method was developed based on auditory feedback of prosodically corrected utterances in the learners own voices basically the method copies contours of f0 local speech rate and intensity from reference utterances of a german native speaker to the learners speech signals it also adds emphasis to the stress position in order to help the learners better recognise the correct pronunciation and identify their errors a perception test with german native speakers revealed that manipulated utterances significantly better reflect lexical stress than the corresponding original utterances thus two groups of italian learners of german were provided with different feedback during a training session one group with manipulated utterances in their individual voices and the other with correctly pronounced original utterances in the teacher s voice afterwards both groups produced the same sentences again and german native speakers judged the resulting utterances resynthesised stimuli especially with emphasised stress were found to be a more effective feedback than natural stimuli to learn the correct stress position since resynthesis was obtained without previous segmentation of the learners speech signals this technology could be effectively included in computer assisted language learning software

a second great depression in the uk regions can anything be done moore b and rhodes j 1982 a second great depression in the uk regions can anything be done reg studies 16 323 33 this is a revised version of a paper given to the regional studies conference in glasgow in may 1981 the authors were asked to put forward the views of the cambridge economic policy group cepg on the economy as a whole and to draw out any implications for the uk regions a diagnosis of the uk economic problem and its regional manifestation is followed by a discussion of the macro economic strategy favoured by the group which aims to ensure that the economy can be expanded at a permanently faster rate without running into balance of payments problems only a strategy of this kind could make a significant impact on the very high rates of unemployment in the depressed regions

is cumulative growth in manufacturing productivity slowing down in the eu12 regions the cumulative causation in the relation between labour productivity and output growth known as verdoorn s law is empirically tested using data from 109 eu12 regions during the period 1977 2005 several specifications of verdoorn s law are put forward in this paper which attribute the process of cumulative causation to a series of factors including manufacturing agglomeration spatial interaction and responses to the problems of growth the findings suggest that although cumulative causation holds over this period the slowdown of its pace is nonetheless apparent post 1992 revisions in responses e g policy along with further research are thus recommended the author 2009 published by oxford university press on behalf of the cambridge political economy society all rights reserved

domestic tourism demand of urban and rural residents in china does relative income matter abstract the aim of this research is to investigate the domestic tourism demand of urban and rural residents in china based on the data from the national household tourism survey we specify chinese domestic tourism demand as a function of absolute income relative income domestic tourism price and substitute price as a major contribution of this study relative income is measured using the distance between individual income and average income over a city province based on the estimation results from multilevel models this paper highlights the effect of relative income on domestic tourism demand in some sub regions of china furthermore regional differences between residents in different sub regions and different patterns of determinants between urban and rural residents are identified and discussed