IDEAS home Printed from https://ideas.repec.org/a/eee/proeco/v166y2015icp64-71.html
   My bibliography  Save this article

Measurement of input-specific productivity growth with an application to the construction industry in Spain and Portugal

Author

Listed:
  • Kapelko, M.
  • Horta, I.M.
  • Camanho, A.S.
  • Oude Lansink, A.

Abstract

Decision making in companies requires an assessment of the efficiency and productivity of individual inputs to provide insights into the scope for improvement of inputs׳ use. This paper estimates an input-specific Luenberger productivity growth indicator that can be decomposed to identify the contributions of input-specific technological change, technical efficiency change and scale efficiency change. These components for a specific input sum up to the aggregated indicators which are then compared with the traditional Luenberger indicator. The application focuses on panel data of Spanish and Portuguese construction firms over the period 2002–2011, accounting for three inputs: materials, labor and capital. The results show that aggregated productivity change and its components computed from the input-specific productivity indicator are different from those obtained using a traditional approach. The results also indicate that productivity change is negative for labor and capital for construction firms in both Spain and Portugal, while productivity change of materials is positive for Portugal and negative for Spain. Productivity decline is worse for capital in the Spanish construction firms, and for labor in Portugal.

Suggested Citation

  • Kapelko, M. & Horta, I.M. & Camanho, A.S. & Oude Lansink, A., 2015. "Measurement of input-specific productivity growth with an application to the construction industry in Spain and Portugal," International Journal of Production Economics, Elsevier, vol. 166(C), pages 64-71.
  • Handle: RePEc:eee:proeco:v:166:y:2015:i:c:p:64-71
    DOI: 10.1016/j.ijpe.2015.03.030
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S092552731500105X
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ferrier, G. D. & Kerstens, K. & Vanden Eeckaut, P., 1994. "Radial and nonradial technical efficiency measures on a DEA reference technology: a comparison using US banking data," CORE Discussion Papers RP 1156, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Briec, Walter & Kerstens, Kristiaan, 2009. "The Luenberger productivity indicator: An economic specification leading to infeasibilities," Economic Modelling, Elsevier, vol. 26(3), pages 597-600, May.
    3. Aparicio, Juan & Pastor, Jesus T. & Zofio, Jose L., 2013. "On the inconsistency of the Malmquist–Luenberger index," European Journal of Operational Research, Elsevier, vol. 229(3), pages 738-742.
    4. Alfons Oude Lansink & Ky–sti Pietola, 2002. "Effciency and productivity of conventional and organic farms in Finland 1994--1997," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 29(1), pages 51-66, March.
    5. Kapelko, Magdalena & Oude Lansink, Alfons & Stefanou, Spiro E., 2014. "Assessing dynamic inefficiency of the Spanish construction sector pre- and post-financial crisis," European Journal of Operational Research, Elsevier, vol. 237(1), pages 349-357.
    6. Färe, Rolf & Grosskopf, Shawna, 2010. "Directional distance functions and slacks-based measures of efficiency: Some clarifications," European Journal of Operational Research, Elsevier, vol. 206(3), pages 702-702, November.
    7. Mahlberg, Bernhard & Sahoo, Biresh K., 2011. "Radial and non-radial decompositions of Luenberger productivity indicator with an illustrative application," International Journal of Production Economics, Elsevier, vol. 131(2), pages 721-726, June.
    8. Wilson, Paul W, 1993. "Detecting Outliers in Deterministic Nonparametric Frontier Models with Multiple Outputs," Journal of Business & Economic Statistics, American Statistical Association, vol. 11(3), pages 319-323, July.
    9. Leopold Simar & Valentin Zelenyuk, 2006. "On Testing Equality of Distributions of Technical Efficiency Scores," Econometric Reviews, Taylor & Francis Journals, vol. 25(4), pages 497-522.
    10. Theodoros Skevas & Alfons Oude Lansink, 2014. "Reducing Pesticide Use and Pesticide Impact by Productivity Growth: the Case of Dutch Arable Farming," Journal of Agricultural Economics, Wiley Blackwell, vol. 65(1), pages 191-211, January.
    11. R. Russell & William Schworm, 2011. "Properties of inefficiency indexes on 〈input, output〉 space," Journal of Productivity Analysis, Springer, vol. 36(2), pages 143-156, October.
    12. Caves, Douglas W & Christensen, Laurits R & Diewert, W Erwin, 1982. "The Economic Theory of Index Numbers and the Measurement of Input, Output, and Productivity," Econometrica, Econometric Society, vol. 50(6), pages 1393-1414, November.
    13. Simar, Léopold & Vanhems, Anne & Wilson, Paul W., 2012. "Statistical inference for DEA estimators of directional distances," European Journal of Operational Research, Elsevier, vol. 220(3), pages 853-864.
    14. Léopold Simar, 2003. "Detecting Outliers in Frontier Models: A Simple Approach," Journal of Productivity Analysis, Springer, vol. 20(3), pages 391-424, November.
    15. Alfons Oude Lansink & Christien Ondersteijn, 2006. "Energy Productivity Growth in the Dutch Greenhouse Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(1), pages 124-132.
    16. Fukuyama, Hirofumi & Weber, William L., 2009. "A directional slacks-based measure of technical inefficiency," Socio-Economic Planning Sciences, Elsevier, vol. 43(4), pages 274-287, December.
    17. I. Horta & A. Camanho & Jill Johnes & Geraint Johnes, 2013. "Performance trends in the construction industry worldwide: an overview of the turn of the century," Journal of Productivity Analysis, Springer, vol. 39(1), pages 89-99, February.
    18. Taewoo You & Hongmin Zi, 2007. "The economic crisis and efficiency change: evidence from the Korean construction industry," Applied Economics, Taylor & Francis Journals, vol. 39(14), pages 1833-1842.
    19. Färe, Rolf & Grosskopf, Shawna, 2010. "Directional distance functions and slacks-based measures of efficiency," European Journal of Operational Research, Elsevier, vol. 200(1), pages 320-322, January.
    20. Mohamed Abdel-Wahab & Bernard Vogl, 2011. "Trends of productivity growth in the construction industry across Europe, US and Japan," Construction Management and Economics, Taylor & Francis Journals, vol. 29(6), pages 635-644.
    21. Elvira Silva & Spiro Stefanou, 2003. "Nonparametric Dynamic Production Analysis and the Theory of Cost," Journal of Productivity Analysis, Springer, vol. 19(1), pages 5-32, January.
    22. Elvira Silva & Alfons Oude Lansink, 2013. "Dynamic Efficiency Measurement: A Directional Distance Function Approach," CEF.UP Working Papers 1307, Universidade do Porto, Faculdade de Economia do Porto.
    23. Yan Li & Chunlu Liu, 2010. "Malmquist indices of total factor productivity changes in the Australian construction industry," Construction Management and Economics, Taylor & Francis Journals, vol. 28(9), pages 933-945.
    24. Chambers, Robert G. & Chung, Yangho & Fare, Rolf, 1996. "Benefit and Distance Functions," Journal of Economic Theory, Elsevier, vol. 70(2), pages 407-419, August.
    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


    Cited by:

    1. Kai Li & Zhili Ma & Guozhou Zhang, 2019. "Evaluation of the Supply-Side Efficiency of China’s Real Estate Market: A Data Envelopment Analysis," Sustainability, MDPI, Open Access Journal, vol. 11(1), pages 1-18, January.
    2. repec:ris:tecemp:2005 is not listed on IDEAS
    3. Shen, Zhiyang & Boussemart, Jean-Philippe & Leleu, Hervé, 2017. "Aggregate green productivity growth in OECD’s countries," International Journal of Production Economics, Elsevier, vol. 189(C), pages 30-39.
    4. Jradi, Samah & Bouzdine Chameeva, Tatiana & Aparicio, Juan, 2019. "The measurement of revenue inefficiency over time: An additive perspective," Omega, Elsevier, vol. 83(C), pages 167-180.
    5. Ying-yu Lu & Yue He & Bo Wang & Shuang-shuang Ye & Yidi Hua & Lei Ding, 2019. "Efficiency Evaluation of Atmospheric Pollutants Emission in Zhejiang Province China: A DEA-Malmquist Based Approach," Sustainability, MDPI, Open Access Journal, vol. 11(17), pages 1-19, August.
    6. Juan Aparicio & Magdalena Kapelko & Bernhard Mahlberg & Jose L. Sainz-Pardo, 2017. "Measuring input-specific productivity change based on the principle of least action," Journal of Productivity Analysis, Springer, vol. 47(1), pages 17-31, February.
    7. Wang, Ke & Wei, Yi-Ming, 2016. "Sources of energy productivity change in China during 1997–2012: A decomposition analysis based on the Luenberger productivity indicator," Energy Economics, Elsevier, vol. 54(C), pages 50-59.
    8. Zhang, Puwei & You, Jianxin & Jia, Guangshe & Chen, Jindao & Yu, Anyu, 2018. "Estimation of carbon efficiency decomposition in materials and potential material savings for China's construction industry," Resources Policy, Elsevier, vol. 59(C), pages 148-159.
    9. repec:spr:cejnor:v:26:y:2018:i:1:d:10.1007_s10100-017-0473-z is not listed on IDEAS
    10. Aparicio, Juan & Ortiz, Lidia & Pastor, Jesus T., 2017. "Measuring and decomposing profit inefficiency through the Slacks-Based Measure," European Journal of Operational Research, Elsevier, vol. 260(2), pages 650-654.
    11. Terjesen, Siri A. & João Guedes, Maria & Patel, Pankaj C., 2016. "Founded in adversity: Operations-based survival strategies of ventures founded during a recession," International Journal of Production Economics, Elsevier, vol. 173(C), pages 161-169.
    12. repec:spr:cejnor:v:26:y:2018:i:4:d:10.1007_s10100-018-0562-7 is not listed on IDEAS
    13. repec:spr:annopr:v:278:y:2019:i:1:d:10.1007_s10479-017-2620-2 is not listed on IDEAS
    14. Fraccascia, Luca & Albino, Vito & Garavelli, Claudio A., 2017. "Technical efficiency measures of industrial symbiosis networks using enterprise input-output analysis," International Journal of Production Economics, Elsevier, vol. 183(PA), pages 273-286.
    15. Magdalena Kapelko & Alfons Oude Lansink, 2018. "Managerial and program inefficiency for European meat manufacturing firms: A dynamic multidirectional inefficiency analysis approach," Journal of Productivity Analysis, Springer, vol. 49(1), pages 25-36, February.
    16. Zubizarreta, Mikel & Cuadrado, Jesús & Iradi, Jon & García, Harkaitz & Orbe, Aimar, 2017. "Innovation evaluation model for macro-construction sector companies: A study in Spain," Evaluation and Program Planning, Elsevier, vol. 61(C), pages 22-37.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:166:y:2015:i:c:p:64-71. 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: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/ijpe .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.