Productivity, Efficiency and Economic Growth: East Asia and the Rest of the World
This study compares the sources of growth in East Asia with the rest of the world, using a methodology that allows one to decompose total factor productivity (TFP) growth into technical efficiency changes (catching up) and technological progress. It applies a varying coefficients frontier production function model to aggregate data for the period 1970-1990, for a sample of 45 developed and developing countries. Our results are consistent with the view that East Asian economies were not outliers in terms of TFP growth. Of the high-performing East Asian economies, our methodology identifies South Korea as having the highest TFP growth, followed by Singapore, Taiwan and Japan. Our methodology also allows us to separately estimate technical efficiency change, which is a component of TFP growth, and we find that, in general, the estimated technical efficiency of the high-performing East Asian economies was not out of line with the rest of the world.
|Date of creation:||01 Mar 2003|
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- Mahadevan, Renuka & Kalirajan, Kali, 2000. "Singapore's Manufacturing Sector's TFP Growth: A Decomposition Analysis," Journal of Comparative Economics, Elsevier, vol. 28(4), pages 828-839, December.
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5326, National Bureau of Economic Research, Inc.
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- Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
- Stanley Fischer, 1993.
"The Role of Macroeconomic Factors in Growth,"
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4565, National Bureau of Economic Research, Inc.
- Young, Alwyn, 1994. "Lessons from the East Asian NICS: A contrarian view," European Economic Review, Elsevier, vol. 38(3-4), pages 964-973, April.
- Sonobe, Tetsushi & Otsuka, Keijiro, 2001. "A new decomposition approach to growth accounting: derivation of the formula and its application to prewar Japan," Japan and the World Economy, Elsevier, vol. 13(1), pages 1-14, January.
- Alwyn Young, 1992. "A Tale of Two Cities: Factor Accumulation and Technical Change in Hong Kong and Singapore," NBER Chapters, in: NBER Macroeconomics Annual 1992, Volume 7, pages 13-64 National Bureau of Economic Research, Inc.
- K.P. Kalirajan & M.B. Obwona & S. Zhao, 1996. "A Decomposition of Total Factor Productivity Growth: The Case of Chinese Agricultural Growth before and after Reforms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 331-338.
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