In a seminal paper, Racine and Li, (Journal of Econometrics, 2004) introduce a tool which admits discrete and categorical variables as regressors in nonparametric regres- sions. The method is similar to the smoothing techniques for continuous regressors but uses discrete kernels. In the...

In industry sectors where market prices are unavailable it is common to represent multiple-input multiple-output production technologies using distance functions. Econometric estimation of such functions is complicated by the fact that more than one variable in the function may be endogenous. In...

This paper investigates the effects of home country banking regulations on the performance of foreign banks in Luxembourg’s financial center. We control for the main regulatory indicators, such as capital requirements, private monitoring, official disciplinary power and restrictions on...

The economically-relevant characteristics of multi-input multi-output production technologies can be represented using distance functions. The econometric approach to estimating these functions typically involves factoring out one of the outputs or inputs and estimating the resulting equation...

In this article we show equivalence between the input oriented and output oriented scale elasticity measures for multi-output, multi-input technologies. We show the necessary and sufficient condition for this equivalence. We also provide a Lagrange multiplier (or shadow price) interpretation of...

Productivity and efficiency change lies at the heart of some of the key challenges facing China’s economy. This paper contributes to an understanding of TFP change by computing and decomposing provincial-level Hicks-Moorsteen (H-M) total factor productivity (TFP) indexes for the period...

In this article we model production technology in a state-contingent framework. Our model analyzes production under uncertainty without regard to the nature of producer risk preferences. In our model producers? risk preferences are captured by the risk-neutral probabilities they assign to the...

In this paper we consider the question of measuring aggregate economic growth and its sources. We derive a theoretically justified solution for aggregating (across firms, industries, countries, etc.) growth rates and their sources within the framework of Solow?s (1957) growth accounting method....

Chambers and Quiggin (2000) have used state-contingent production theory to establish important results concerning economic behaviour in the presence of uncertainty, including problems of consumer choice, the theory of the firm, and principal-agent relationships. Empirical application of the...

Profitability change can be decomposed into the product of a total factor productivity (TFP) index and an index of relative price change. O’Donnell (2008) shows that the TFP index can be further decomposed into an index of technical change and various indexes of efficiency change –...