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Productivity Trends in Australian and New Zealand Manufacturing
Author(s) -
Färe Rolf,
Grosskopf Shawna,
Margaritis Dimitri
Publication year - 2001
Publication title -
australian economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.308
H-Index - 29
eISSN - 1467-8462
pISSN - 0004-9018
DOI - 10.1111/1467-8462.00183
Subject(s) - total factor productivity , productivity , index (typography) , manufacturing sector , technical change , multifactor productivity , economics , manufacturing , malmquist index , technological change , sample (material) , econometrics , economic geography , business , labour economics , macroeconomics , computer science , chemistry , chromatography , marketing , world wide web
The purpose of this article is to study relative trends in total factor productivity (TFP) between the Australian and New Zealand manufacturing sectors from 1986 to 1996. Since 1984 both economies have undergone major structural changes with varying degrees of speed and intensity. We use the Malmquist index to measure TFP growth and decompose it into an efficiency change and a technical change component. This decomposition provides extra insight on assessing relative productivity trends during a period of economic reform. The results indicate the Australian manufacturing sector exhibits better rates of individual factor productivity performance while multifactor productivity is estimated to be higher in New Zealand manufacturing. TFP growth in New Zealand is driven by technical rather than efficiency change. In fact, the New Zealand manufacturing average rate of efficiency change is estimated to be negative over the sample period.