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Analysing Firm-Level Labour Productivity Using Survey Data

  • Mark Rogers

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Yi-Ping Tseng

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

This paper investigates the determinants of firm-level labour productivity in the manufacturing sector using GAPS data. These data are from a stratified survey, where the strata are based on industry and firm size. The paper focuses on whether weights should be applied in the regression analysis. Augmented Cobb-Douglas production functions are estimated, where a set of dummies are used as proxies for firm-level knowledge stocks. The regression results show that there are significant differences between the parameters estimated by weighted least squares (WLS) and OLS, particularly for the variables union density and training expenditure. These differences can be caused by parameter heterogeneity (across strata); in theoretical terms this means that applying the same production function across all firms is not appropriate. Given this parameter heterogeneity, both the OLS and WLS methods do not estimate parameters of interest. Instead, there is a requirement to estimate sub-sample regressions. These are presented in the second part of the empirical results.

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Paper provided by Melbourne Institute of Applied Economic and Social Research, The University of Melbourne in its series Melbourne Institute Working Paper Series with number wp2000n10.

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Length: 23 pages
Date of creation: Oct 2000
Date of revision:
Handle: RePEc:iae:iaewps:wp2000n10
Contact details of provider: Postal: Melbourne Institute of Applied Economic and Social Research, The University of Melbourne, Victoria 3010 Australia
Phone: +61 3 8344 2100
Fax: +61 3 8344 2111
Web page: http://www.melbourneinstitute.com/
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  1. Aw, B. -Y. & Hwang, A. R., 1995. "Productivity and the export market: A firm-level analysis," Journal of Development Economics, Elsevier, vol. 47(2), pages 313-332, August.
  2. Robert J. Barro & Paul M. Romer, 1991. "Economic Growth," NBER Books, National Bureau of Economic Research, Inc, number barr91-1, October.
    • Robert J. Barro & Paul Romer, 1993. "Economic Growth," NBER Books, National Bureau of Economic Research, Inc, number barr93-1, October.
  3. Brynjolfsson, Erik. & Hitt, Lorin M., 1994. "Information technology as a factor of production : the role of differences among firms," Working papers 3715-94. CCSTR ; #173., Massachusetts Institute of Technology (MIT), Sloan School of Management.
  4. repec:sae:niesru:v:162:y::i:1:p:85-98 is not listed on IDEAS
  5. Frank R. Lichtenberg, 1993. "The Output Contributions of Computer Equipment and Personnel: A Firm- Level Analysis," NBER Working Papers 4540, National Bureau of Economic Research, Inc.
  6. Nadiri, M.I., 1993. "Innovations and Technological Spillovers," Working Papers 93-31, C.V. Starr Center for Applied Economics, New York University.
  7. M. Ishaq Nadiri, 1993. "Innovations and Technological Spillovers," NBER Working Papers 4423, National Bureau of Economic Research, Inc.
  8. Martin Neil Baily & Robert J. Gordon, 1988. "The Productivity Slowdown, Measurement Issues, and the Explosion of Computer Power," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(2), pages 347-432.
  9. Anne Hawke & Mark Wooden, 1997. "The 1995 Australian Workplace Industrial Relations Survey," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 30(3), pages 323-328.
  10. Black, Sandra E & Lynch, Lisa M, 1996. "Human-Capital Investments and Productivity," American Economic Review, American Economic Association, vol. 86(2), pages 263-67, May.
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