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The Malmquist Productivity Index and Plant Capacity Utilization
Author(s) -
De Borger Bruno,
Kerstens Kristiaan
Publication year - 2000
Publication title -
scandinavian journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.725
H-Index - 64
eISSN - 1467-9442
pISSN - 0347-0520
DOI - 10.1111/1467-9442.00201
Subject(s) - inefficiency , malmquist index , index (typography) , productivity , economics , technical change , econometrics , decomposition , technological change , productivity model , dual (grammatical number) , data envelopment analysis , production–possibility frontier , total factor productivity , mathematics , microeconomics , statistics , computer science , macroeconomics , art , ecology , literature , biology , world wide web
A new decomposition of the Malmquist productivity index is proposed to account for changes in plant capacity utilization. Using a primal, non‐parametric specification of technology, the Malmquist index is decomposed into technical efficiency change, variations in plant capacity utilization and frontier shifts. It provides an alternative to the available methods of incorporating capacity utilization changes into measures of productivity change. Such measures are based on parametric (and, in many cases, dual) technology specifications; moreover, they typically do not allow for technical inefficiency. JEL Classification C 61; D 24