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Productivity measures and effects from subsidies and trade: an empirical analysis for Japan's forestry

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  • Shunsuke Managi

Abstract

Several techniques have been proposed in the literature to measure productivity. While allowing for inefficiency of the production unit, we provide a methodological comparison of alternative approaches to measure total factor productivity. This article evaluates the effects of unintended policy outcomes such as government subsidies and foreign trade. Empirically, we analyse the forest productivity of timber in Japan by using panel data on 46 regions. The results suggest substantial variation in productivity between these two techniques although average trends are similar. We find that subsidies impede competition since the government is ready to rescue a loss-making firm with subsidies rather than allow it to close. In contrast, trade is shown to have positive effects on productivity.

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  • Shunsuke Managi, 2010. "Productivity measures and effects from subsidies and trade: an empirical analysis for Japan's forestry," Applied Economics, Taylor & Francis Journals, vol. 42(30), pages 3871-3883.
    • Handle: RePEc:taf:applec:v:42:y:2010:i:30:p:3871-3883
    DOI: 10.1080/00036840802360146
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    Cited by:

    1. Richard Harris & John Moffat, 2020. "The impact of product subsidies on plant‐level total factor productivity in Britain, 1997–2014," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(4), pages 387-403, September.
    2. Mauerhofer, Volker, 2018. "Identifying Legal Priorities for Policy Making: A Forest-society-economy Context Analysed by 3-D Sustainability," Ecological Economics, Elsevier, vol. 152(C), pages 183-190.
    3. Młynarski, Wojciech & Prędki, Artur & Kaliszewski, Adam, 2021. "Efficiency and factors influencing it in forest districts in southern Poland: Application of Data Envelopment Analysis," Forest Policy and Economics, Elsevier, vol. 130(C).
    4. Arnaud Abad & Paola Ravelojaona, 2022. "A generalization of environmental productivity analysis," Post-Print hal-03592375, HAL.
    5. Richard Harris & Shengyu Li, 2016. "Government Assistance and Total Factor Productivity: Firm-level Evidence from China, 1998-2007," CEMAP Working Papers 2016_04, Durham University Business School.
    6. Mattsson, Pontus, 2019. "The impact of labour subsidies on total factor productivity and profit per employee," Economic Analysis and Policy, Elsevier, vol. 62(C), pages 325-341.
    7. Guohua Feng & Todd Jewell, 2021. "Productivity and efficiency at english football clubs: a random coefficient approach," Scottish Journal of Political Economy, Scottish Economic Society, vol. 68(5), pages 571-604, November.
    8. Richard Harris & Shengyu Li, 2019. "Government assistance and total factor productivity: firm-level evidence from China," Journal of Productivity Analysis, Springer, vol. 52(1), pages 1-27, December.
    9. Arnaud Abad & Paola Ravelojaona, 2020. "A Generalization of Environmental Productivity Analysis," Working Papers hal-02964799, HAL.
    10. Heli Koski & Mika Pajarinen, 2015. "Subsidies, the Shadow of Death and Labor Productivity," Journal of Industry, Competition and Trade, Springer, vol. 15(2), pages 189-204, June.
    11. Managi, Shunsuke & Hibiki, Akira & Shimane, Tetsuya, 2014. "Efficiency or technology adoption: A case study in waste-treatment technology," Resource and Energy Economics, Elsevier, vol. 36(2), pages 586-600.
    12. Ang, Frederic & Kerstens, Pieter Jan, 2017. "Decomposing the Luenberger–Hicks–Moorsteen Total Factor Productivity indicator: An application to U.S. agriculture," European Journal of Operational Research, Elsevier, vol. 260(1), pages 359-375.
    13. Koski, Heli & Pajarinen, Mika, 2013. "Subsidies, Shadow of Death and Productivity," ETLA Working Papers 16, The Research Institute of the Finnish Economy.

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