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Multiple directions for measuring biased technical change

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  • Mizobuchi, Hideyuki

Abstract

The technological change component of the Malmquist productivity index is defined as the radial distance between isoquants along a single direction. Therefore, it relies on limited information to measure technological change, which is a naturally global phenomenon. This becomes problematic, particularly when technological change is not Hicks-neutral but biased towards certain inputs or outputs. To mitigate this problem, I propose a more global measure of technological change that uses two directions. When combined with existing measures of other contributing factors, this measure constitutes an alternative productivity index, which is the geometric mean of the Malmquist and Hicks–Moorsteen productivity indices based on the cone technologies.

Suggested Citation

  • Mizobuchi, Hideyuki, 2024. "Multiple directions for measuring biased technical change," Omega, Elsevier, vol. 127(C).
    • Handle: RePEc:eee:jomega:v:127:y:2024:i:c:s0305048324000331
    DOI: 10.1016/j.omega.2024.103066
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    Keywords

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    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

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