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Modeling Technology as a Dynamic Error Components Process: The Case of the Inter-country Agricultural Production Function†

Author

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  • Rodolfo Cermeño
  • G. S. Maddala
  • Michael A. Trueblood

Abstract

In this paper, we propose a dynamic error-components model to represent the unobserved level of technology. This specification implies a well-defined common factor dynamic model for per capita output that can be tested explicitly. The model is applied to data on aggregates of agricultural inputs and outputs for groups of countries from the OECD, Africa (AF), Latin America (LA) as well as centrally planned countries, over a period of 31 years. We find that the proposed model fits the data better than alternative static specifications and satisfies the implied common factor restrictions in two of the samples. The results suggest that although technological change seems to have been a faster process for less developed countries relative to the OECD countries, it has not been fast enough to reduce appreciably the enormous differences in average technological levels that still persist between them. -super-†Dedicated to the memory of G. S. Maddala.

Suggested Citation

  • Rodolfo Cermeño & G. S. Maddala & Michael A. Trueblood, 2003. "Modeling Technology as a Dynamic Error Components Process: The Case of the Inter-country Agricultural Production Function†," Econometric Reviews, Taylor & Francis Journals, vol. 22(3), pages 289-306, January.
    • Handle: RePEc:taf:emetrv:v:22:y:2003:i:3:p:289-306
    DOI: 10.1081/ETC-120024753
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    Cited by:

    1. Rakotoarisoa, Manitra A., 2011. "The impact of agricultural policy distortions on the productivity gap: Evidence from rice production," Food Policy, Elsevier, vol. 36(2), pages 147-157, April.
    2. Nin Pratt, Alejandro & Falconi, César & Ludeña, Carlos E. & Martel, Pedro, 2015. "Productivity and the Performance of Agriculture in Latin America and the Caribbean: From the Lost Decade to the Commodity Boom," IDB Publications (Working Papers) 7306, Inter-American Development Bank.
    3. Rakotoarisoa, Manitra A., 2008. "The Impact of Agricultural Policy Distortions on the Productivity Gap: Evidence from the Rice Production," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6154, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Guang Chen & Yue Deng & Apurbo Sarkar & Zhengbing Wang, 2022. "An Integrated Assessment of Different Types of Environment-Friendly Technological Progress and Their Spatial Spillover Effects in the Chinese Agriculture Sector," Agriculture, MDPI, vol. 12(7), pages 1-24, July.

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