Exploring the Covariance Term in the Olley-Pakes Productivity Decomposition

2018 ◽  
pp. 169-182
Author(s):  
Giannis Karagiannis ◽  
Suzanna M. Paleologou
Keyword(s):  
Productivity Decomposition ◽  
Covariance Term

Aggregate Efficiency Dynamics in Lithuanian Dairy Farms

2021 ◽  
Vol 70 (4) ◽  
pp. 251-264
Author(s):  
Tomas Balezentis ◽  
Giannis Karagiannis
Keyword(s):  
Decision Making ◽  
Structural Changes ◽  
Dairy Farms ◽  
Family Farms ◽  
Efficiency Change ◽  
Empirical Application ◽  
Level Data ◽  
Covariance Term ◽  
Large Farms ◽  
Decision Making Units

In this paper, we attempt to identify the major groups of decision making units (dairy farms) contributing to the aggregate efficiency change. We also suggest identifying influential peers in order to gain more insights into possible development strategies within a sector. The empirical application focuses on specialist dairy farms in Lithuania. The farm-level data cover the period 2004-2016. The results indicate the presence of structural changes and resulting shifts in the aggregate efficiency. Based on the results of decomposition of the covariance term and identification of the influential peers, two models can be followed by Lithuanian dairy farms, namely “pure” family farms with lower operational scale and large farms involving hired labour.

Resource misallocation of SMEs in Vietnamese manufacturing sector

2019 ◽  
Vol 26 (3) ◽  
pp. 290-303
Author(s):  
Phuong Thi Nguyen ◽  
Minh Khac Nguyen
Keyword(s):  
Developing Countries ◽  
Total Factor Productivity ◽  
Design Methodology ◽  
Large Scale ◽  
Manufacturing Sector ◽  
Factor Productivity ◽  
Content Type ◽  
Resource Misallocation ◽  
Productivity Decomposition ◽  
Enterprise Survey

Purpose The purpose of this paper is to examine resource misallocation among Vietnam’s small- and medium-sized enterprises (SMEs) in the manufacturing sector. The paper also aims to consider selective factors on reducing the level of resource misallocation in SMEs. Design/methodology/approach Resource misallocation and efficiency gains in total factor productivity (TFP) are assessed using Vietnam’s annual enterprise survey data for the period 2000–2015 and an appropriate productivity decomposition framework. Findings Resource misallocation is found to be higher among SMEs than large scale enterprises. TFP is found to 116.3 per cent greater if there is no resource misallocation among SMEs. Smaller scale, lower market concentration, trade liberalisation and corruption control are found to be associated with lower level of resource misallocation in SMEs. Research limitations/implications The major limitation of this study is that it has only decomposed misallocation of resources arising from output and capital distortions and that it focusses on selective factors contribution to reducing misallocation level in SMEs. Originality/value Resource misallocation is attracting attention in both developed and developing countries. However, knowledge about resource misallocation among SMEs is limited, particularly in the context of developing countries. This paper assesses the level of resource misallocation among SMEs in Vietnamese manufacturing sector.

Misallocation and reallocation of resources in Vietnamese manufacturing firms

2020 ◽  
Vol 47 (7) ◽  
pp. 1605-1627
Author(s):  
Phuong Thi Nguyen ◽  
Minh Khac Nguyen
Keyword(s):  
Market Share ◽  
Choice Model ◽  
Manufacturing Sector ◽  
Productivity Change ◽  
Aggregate Productivity ◽  
Firm Level ◽  
Content Type ◽  
Resource Misallocation ◽  
Productivity Decomposition ◽  
Exit Decisions

PurposeThis research identifies the level of misallocation in Vietnamese manufacturing sector for the period 2000–2015. Meltiz and Polanec dynamic productivity decomposition is used to compare the relative productivity contributions from surviving, entering and exiting firms to aggregate productivity change by the type of ownership. Heckman's two-step model is used to examine the effect of misallocation and industry- and firm-level factors on entry or exit decision and market share of firms in Vietnamese manufacturing sector.Design/methodology/approachThe level of misallocation and efficiency gains in total factor productivity (TFP) are assessed using Hsieh and Klenow (2009) productivity decomposition framework for the period 2000–2015. The dynamic productivity decomposition of Meltiz and Polanec (2015) is used to compare the relative contributions from surviving, entering and exiting firms to aggregate productivity change. The effects of misallocation and other factors on entry or exit decisions and market share of firms are determined by using Heckman choice model.FindingsThe results indicate three main points. Firstly, resource misallocation is found to be highest among state-owned enterprise (SOEs) and low technology industries. TFP is found to 81.2% greater if there is no resource misallocation among firms. Secondly, the aggregate productivity change for the entering, exiting and surviving firms is 35% due to productivity reallocation among three groups. Finally, the decision of entry or exit as well as the market share of firms are influenced by misallocation and industry- and firm-level factors such as Vietnam's WTO entry, tax policy, financial frictions, industrial concentration, technology gap, capital intensity, human capital, scale of firm, time entry and FDI spillovers. The result finds the higher misallocation level is, the lower the probability and market share for a new firm to enter in the industry is.Research limitations/implicationsThe main limitation of the study is that the market is assumed perfectly competitive and the method has only decomposed misallocation of resources to those arising from output and capital distortions. The results of Heckman choice model only clarify on the sub-sample of state-owned enterprises and low technology firms.Originality/valueThe focus of many previous research papers on resource misallocation was generally to look at the level of misallocation in developed countries. However, knowledge about the effect of misallocation and other factors on entry or exit decisions and market share of firms is limited, particularly in the context of developing countries. This paper clarifies the level of misallocation in Vietnamese manufacturing sector and the effect of misallocation and other factors on entry or exit decisions and market share of firms.

Components of the evoked potential in the MES auditory cortex

1960 ◽  
Vol 199 (3) ◽  
pp. 529-534 ◽  
Author(s):  
Archie R. Tunturi
Keyword(s):  
Standard Deviation ◽  
Auditory Cortex ◽  
Electrical Activity ◽  
Evoked Potential ◽  
Random Variable ◽  
Positive Component ◽  
Negative Component ◽  
Spontaneous Electrical Activity ◽  
Covariance Term ◽  
The Mean

The electrical activity during the potential evoked by a p pulse was analyzed statistically by considering amplitude at each 3-msec. epoch a random variable. The rise in standard deviation during the evoked potential was abolished a) by local cocaine on the cortex, b) by a preceding evoked potential and c) by ischemia. The residual mean positive component, with zero standard deviation, was subtracted from the mean of the evoked potential. This yielded a positive-negative component, with which the spontaneous electrical activity is believed to interact. The evoked potential is thus described as the sum of the three random variables: a) spontaneous electrical activity, b) positive component, and c) positive-negative component, with a covariance term involving the spontaneous electrical activity and the positive-negative component.

scholarly journals The Quanto Theory of Exchange Rates

2019 ◽  
Vol 109 (3) ◽  
pp. 810-843 ◽  
Author(s):  
Lukas Kremens ◽  
Ian Martin
Keyword(s):  
Random Walk ◽  
Exchange Rates ◽  
Purchasing Power Parity ◽  
Uncovered Interest Parity ◽  
Power Parity ◽  
Panel Regressions ◽  
Out Of Sample ◽  
Covariance Term ◽  
Interest Parity ◽  
Forecast Variable

We present a new identity that relates expected exchange rate appreciation to a risk-neutral covariance term, and use it to motivate a currency forecasting variable based on the prices of quanto index contracts. We show via panel regressions that the quanto forecast variable is an economically and statistically significant predictor of currency appreciation and of excess returns on currency trades. Out of sample, the quanto variable outperforms predictions based on uncovered interest parity, on purchasing power parity, and on a random walk as a forecaster of differential (dollar-neutral) currency appreciation. (JEL C53, E43, F31, F37, G12, G15)

scholarly journals Relationships among Four-Dimensional Hybrid Ensemble–Variational Data Assimilation Algorithms with Full and Approximate Ensemble Covariance Localization

2016 ◽  
Vol 144 (2) ◽  
pp. 591-606 ◽  
Author(s):  
Chengsi Liu ◽  
Ming Xue
Keyword(s):  
Data Assimilation ◽  
Linear Model ◽  
Control Variable ◽  
Adjoint Model ◽  
Background Error ◽  
Background Error Covariance ◽  
Error Covariance ◽  
Covariance Term ◽  
Observation Space ◽  
Static Background

Abstract Ensemble–variational data assimilation algorithms that can incorporate the time dimension (four-dimensional or 4D) and combine static and ensemble-derived background error covariances (hybrid) are formulated in general forms based on the extended control variable and the observation-space-perturbation approaches. The properties and relationships of these algorithms and their approximated formulations are discussed. The main algorithms discussed include the following: 1) the standard ensemble 4DVar (En4DVar) algorithm incorporating ensemble-derived background error covariance through the extended control variable approach, 2) the 4DEnVar neglecting the time propagation of the extended control variable (4DEnVar-NPC), 3) the 4D ensemble–variational algorithm based on observation space perturbation (4DEnVar), and 4) the 4DEnVar with no propagation of covariance localization (4DEnVar-NPL). Without the static background error covariance term, none of the algorithms requires the adjoint model except for En4DVar. Costly applications of the tangent linear model to localized ensemble perturbations can be avoided by making the NPC and NPL approximations. It is proven that En4DVar and 4DEnVar are mathematically equivalent, while 4DEnVar-NPC and 4DEnVar-NPL are mathematically equivalent. Such equivalences are also demonstrated by single-observation assimilation experiments with a 1D linear advection model. The effects of the non-flow-following or stationary localization approximations are also examined through the experiments. All of the above algorithms can include the static background error covariance term to establish a hybrid formulation. When the static term is included, all algorithms will require a tangent linear model and an adjoint model. The first guess at appropriate time (FGAT) approximation is proposed to avoid the tangent linear and adjoint models. Computational costs of the algorithms are also discussed.

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