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Hicks-Moorsteen versus Malmquist: a connection by means of a radial productivity index

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  • Antonio Peyrache

Abstract

A primal index of productivity change is introduced which decomposes exactly into three components: technical change, technical efficiency change and average scale economies (radial scale change). The productivity index is defined using variations of the distance function along pre-assigned input–output rays and, for this reason, it is deemed a radial productivity index (RPI). It is proven that: first, the RPI index collapses to the Malmquist productivity index when the technology is constant returns to scale (CRS); second the RPI index equals the Hicks-Moorsteen productivity index under homotheticity of technology (and non-CRS). The key to these results is a new definition and measure of the contribution of scale economies to productivity change. Copyright Springer Science+Business Media New York 2014

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  • Antonio Peyrache, 2014. "Hicks-Moorsteen versus Malmquist: a connection by means of a radial productivity index," Journal of Productivity Analysis, Springer, vol. 41(3), pages 435-442, June.
    • Handle: RePEc:kap:jproda:v:41:y:2014:i:3:p:435-442
    DOI: 10.1007/s11123-013-0350-2
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    Cited by:

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    2. Hongwei Liu & Henry Tsai, 2018. "Total factor productivity growth and regional competitive analysis of China’s star-rated hotels," Tourism Economics, , vol. 24(6), pages 625-644, September.
    3. Briec, Walter & Kerstens, Kristiaan & Prior, Diego & Van de Woestyne, Ignace, 2018. "Testing general and special Färe-Primont indices: A proposal for public and private sector synthetic indices of European regional expenditures and tourism," European Journal of Operational Research, Elsevier, vol. 271(2), pages 756-768.
    4. Boon Liat Lee & Clevo Wilson & Carl A. Pasurka & Hidemichi Fujii & Shunsuke Managi, 2017. "Sources of airline productivity from carbon emissions: an analysis of operational performance under good and bad outputs," Journal of Productivity Analysis, Springer, vol. 47(3), pages 223-246, June.
    5. Barnabé Walheer, 2022. "Global Malmquist and cost Malmquist indexes for group comparison," Journal of Productivity Analysis, Springer, vol. 58(1), pages 75-93, August.
    6. Pastor, Jesus T. & Lovell, C.A. Knox & Aparicio, Juan, 2020. "Defining a new graph inefficiency measure for the proportional directional distance function and introducing a new Malmquist productivity index," European Journal of Operational Research, Elsevier, vol. 281(1), pages 222-230.
    7. Barnabé Walheer, 2018. "Cost Malmquist productivity index: an output-specific approach for group comparison," Journal of Productivity Analysis, Springer, vol. 49(1), pages 79-94, February.
    8. Karagiannis, Giannis & Knox Lovell, C.A., 2016. "Productivity measurement in radial DEA models with a single constant input," European Journal of Operational Research, Elsevier, vol. 251(1), pages 323-328.
    9. Balk, B.M. & Zofío, J.L., 2018. "The Many Decompositions of Total Factor Productivity Change," ERIM Report Series Research in Management ERS-2018-003-LIS, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    10. Tang, Liwei & He, Gang, 2021. "How to improve total factor energy efficiency? An empirical analysis of the Yangtze River economic belt of China," Energy, Elsevier, vol. 235(C).
    11. Walheer, Barnabé, 2019. "Malmquist productivity index for multi-output producers: An application to electricity generation plants," Socio-Economic Planning Sciences, Elsevier, vol. 65(C), pages 76-88.

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    More about this item

    Keywords

    Productivity; CCD Malmquist; Hicks-Moorsteen; Average scale economies; D24;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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