Advanced Search
MyIDEAS: Login

Driving Factors of Growth in Hungary - a Decomposition Exercise

Contents:

Author Info

  • Gábor Kátay

    ()
    (Magyar Nemzeti Bank)

  • Zoltán Wolf

    (Tinbergen Institute)

Abstract

Applications tend to ignore that measured TFP reflects the variation of output that cannot be explained by changes in inputs. Such a change is not necessarily technological, so measured TFP differences across firms are an amalgam of technological, efficiency and other differences in attributes, which calls for further refinement in the treatment of TFP. To control for cyclical effects, we modify a standard technique in firmlevel production function estimation using a capacity utilization proxy. Based on a large panel of Hungarian manufacturing firms, we decompose value added growth to input factor, capacity utilization and estimated TFP growth contributions. We find that using an hours worked proxy, the variance of the residual drops considerably. We also find that TFP’s role has not been stable over the period: it contributed to value added growth mostly in periods when/after institutional reforms, privatization or FDI inflow took place and lost its importance several years after the shocks.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://english.mnb.hu/Root/Dokumentumtar/ENMNB/Kiadvanyok/mnben_mnbfuzetek/WP_2008_6.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Magyar Nemzeti Bank (the central bank of Hungary) in its series MNB Working Papers with number 2008/6.

as in new window
Length: 38 pages
Date of creation: 2008
Date of revision:
Handle: RePEc:mnb:wpaper:2008/6

Contact details of provider:
Web page: http://www.mnb.hu/
More information through EDIRC

Related research

Keywords: economic growth; production function; input factor contributions; total factor productivity; capacity utilization; aggregation; panel data.;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Gabor Kertesi & Janos Kollo, 2003. "The Employment Effects of Nearly Doubling the Minimum Wage - The Case of Hungary," Budapest Working Papers on the Labour Market 0306, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
  2. G. Steven Olley & Ariel Pakes, 1992. "The Dynamics of Productivity in the Telecommunications Equipment Industry," NBER Working Papers 3977, National Bureau of Economic Research, Inc.
  3. Gábor Kátay & Zoltán Wolf, 2004. "Investment Behavior, User Cost and Monetary Policy Transmission - the Case of Hungary," MNB Working Papers 2004/12, Magyar Nemzeti Bank (the central bank of Hungary).
  4. Susanto Basu & Miles S. Kimball, 1997. "Cyclical Productivity with Unobserved Input Variation," NBER Working Papers 5915, National Bureau of Economic Research, Inc.
  5. Jesus Felipe & Franklin M. Fisher, 2003. "Aggregation in Production Functions: What Applied Economists should Know," Metroeconomica, Wiley Blackwell, vol. 54(2-3), pages 208-262, 05.
  6. J. David Brown & John S. Earle & Almos Telegdy, 2005. "The Productivity Effects of Privatization: Longitudinal Estimates from Hungary, Romania, Russia, and Ukraine," Upjohn Working Papers and Journal Articles 05-121, W.E. Upjohn Institute for Employment Research.
  7. Susanto Basu & John Fernald & Miles Kimball, 1998. "Are technology improvements contractionary?," International Finance Discussion Papers 625, Board of Governors of the Federal Reserve System (U.S.).
  8. Ackerberg, Daniel & Caves, Kevin & Frazer, Garth, 2006. "Structural identification of production functions," MPRA Paper 38349, University Library of Munich, Germany.
  9. Richard Blundell & Stephen Bond, 2000. "GMM Estimation with persistent panel data: an application to production functions," Econometric Reviews, Taylor & Francis Journals, vol. 19(3), pages 321-340.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Kátay, Gábor, 2008. "Do firms provide wage insurance against shocks? Evidence from Hungary," Working Paper Series 0964, European Central Bank.
  2. Kamil Galuscak & Lubomir Lizal, 2011. "The Impact of Capital Measurement Error Correction on Firm-Level Production Function Estimation," Working Papers 2011/09, Czech National Bank, Research Department.
  3. Gábor Békés & Péter Harasztosi, 2010. "Agglomeration Premium and Trading Activity of Firms," CeFiG Working Papers 11, Center for Firms in the Global Economy, revised 28 Jan 2010.
  4. Eric J. Bartelsman & Zoltan Wolf, 2009. "Forecasting Aggregate Productivity using Information from Firm-Level Data," Tinbergen Institute Discussion Papers 09-043/3, Tinbergen Institute.
  5. Békés, Gábor & Halpern, László & Muraközy, Balázs, 2011. "A teremtő rombolás szerepe a vállalati termelékenység alakulásában Magyarországon
    [The role of creative destruction in the development of corporate productivity in Hungary]
    ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(2), pages 111-132.
  6. Péter Harasztosi, 2011. "Growth in Hungary 1994-2008: The role of capital, labour, productivity and reallocation," MNB Working Papers 2011/12, Magyar Nemzeti Bank (the central bank of Hungary).
  7. Konstantins Benkovskis & Ludmila Fadejeva & Robert Stehrer & Julia Woerz, 2012. "How Important is Total Factor Productivity for Growth in Central, Eastern and Southeastern European Countries?," Working Papers 2012/05, Latvijas Banka.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:mnb:wpaper:2008/6. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Johanna Jeney).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.