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A note on the choice of Malmquist productivity index and Malmquist total factor productivity index

Author

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  • Halkos, George
  • Tzeremes, Nickolaos

Abstract

This paper by analyzing the two popular methodologies of productivity measurement provides an example that illustrates the differences when adopting the two methodologies. Furthermore, under the restriction of constant returns to scale raises some methodological issues regarding the theory of productivity measurement using the Malmquist Productivity Index and Malmquist Total Factor Productivity Index. Furthermore by using an illustrative example under the restriction of constant returns to scale the study indicates that the two indexes produce similar results. However, the differences observed are determining the choice of the methodology adopted when measuring productivity.

Suggested Citation

  • Halkos, George & Tzeremes, Nickolaos, 2006. "A note on the choice of Malmquist productivity index and Malmquist total factor productivity index," MPRA Paper 32083, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:32083
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    File URL: https://mpra.ub.uni-muenchen.de/32083/1/MPRA_paper_32083.pdf
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    References listed on IDEAS

    as
    1. David Lambert, 1999. "Scale and the Malmquist productivity index," Applied Economics Letters, Taylor & Francis Journals, vol. 6(9), pages 593-596.
    2. Bjurek, Hans, 1996. " The Malmquist Total Factor Productivity Index," Scandinavian Journal of Economics, Wiley Blackwell, vol. 98(2), pages 303-313, June.
    3. 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.
    4. Fare, Rolf & Grosskopf, Shawna & Roos, Pontus, 1996. "On two definitions of productivity," Economics Letters, Elsevier, vol. 53(3), pages 269-274, December.
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    Cited by:

    1. Ferran Armada Ramírez, 2015. "European Energy Market Integration: Efficiency Improvements in Electricity Producing Firms," UB Economics Working Papers 2015/331, Universitat de Barcelona, Facultat d'Economia i Empresa, UB School of Economics.

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    More about this item

    Keywords

    Productivity measurement; Malmquist Productivity Index; Malmquist Total Factor Productivity Index;
    All these keywords.

    JEL classification:

    • C69 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Other
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • I10 - Health, Education, and Welfare - - Health - - - General

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