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Exports, Margins and Productivity Growth: with an Application to the Canadian Softwood Lumber Industry

  • Bernstein, J.I.

The purpose of this paper is to evaluate the allocative and dynamic efficiency of the Canadian softwood lumber industry by testing for the existence of price-cost margins and decomposing rates of total factor productivity (TFP) growth. A dynamic model of multiple output production and investment is developed in which output is sold domestically and exported. Price-cost margins are parametrized and estimated. The empirical results show that prices are equated to short-run marginal costs in domestic and export markets. TFP growth is decomposed into four elements; technological change, returns to sale, price-cost margins and capital adjustment. The empirical results show that, for the Canadian softwood lumber industry, TFP growth averaged 3 percent per year and the major contributing element was the rate of technological change. Copyright 1994 by MIT Press.

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Paper provided by C.V. Starr Center for Applied Economics, New York University in its series Working Papers with number 92-23.

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Length: 28 pages
Date of creation: 1992
Date of revision:
Handle: RePEc:cvs:starer:92-23
Contact details of provider: Postal: C.V. Starr Center, Department of Economics, New York University, 19 W. 4th Street, 6th Floor, New York, NY 10012
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Order Information: Postal: C.V. Starr Center, Department of Economics, New York University, 19 W. 4th Street, 6th Floor, New York, NY 10012

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