Efficiency Issues in Transitional Economies : An Application to Hungary

by Piesse, Jenifer

• ISBN13: 9781840149791
• ISBN10: 1840149795
• Format: Hardcover
• Copyright: 1999-02-01
• Publisher: Ashgate Pub Co

Summary

This book uses a number of approaches to measure the performance of firms in the transition economies of Central and Eastern Europe during the early stages of reform. There is considerable controversy about the level of productivity in this period, as is evident by contradictory evidence quoted in the literature and a high degree of inconsistency in published national statistics. Indeed, the disagreement extends to the measurement approach and the results for this group of countries. Particularly difficult is any analysis at the firm level, as data is inconsistent, incomplete and based on pre-reform accounting systems. The information used in the book is a unique panel data set of 64 items collected from 1000 firms across 25 industry sectors in Hungary. Productive efficiency is measured and the reasons for poor performance are discussed. It was found that industrial sectors differ in their average performance levels and in the factors most likely to account for this. Finally recommendations are developed to help to reverse the decline in productivity.

Table of Contents

List of Tables	p. ix
List of Figures	p. xi
Acknowledgements	p. xii
Introduction	p. 1
The Transition, Production Theory, Hungarian Accounting and Data	p. 5
Measurement in Periods of Transition	p. 7
Introduction	p. 7
The Characteristics of Economies in Transition	p. 9
Why Measuring Efficiency in Production is Worthwhile	p. 11
Conclusion: The Contribution of this Study	p. 14
The Economics of Transition	p. 16
Introduction	p. 16
An Overview of the Process of Reform	p. 16
Enterprise Reform	p. 21
Performance Measurement: A Selective Survey	p. 24
Industrial Policy and Structural Transformation	p. 29
Conclusion	p. 31
Parametric and Nonparametric Measures of Efficiency and Total Factor Productivity: Theoretical Relationships	p. 32
Introduction	p. 32
The Measurement of Productive Efficiency	p. 34
Productivity Indices Derived from Parametric Functions	p. 41
Nonparametric Production Models	p. 46
Productivity Indices Derived from Nonparametric Functions	p. 49
Parametric vs Nonparametric Models of Efficiency and Productivity Measurement	p. 51
Conclusion	p. 52
The Contribution of Accounting Information in Efficiency Measurement: Hungarian Firm Level Data	p. 55
Introduction	p. 55
The Characteristics of Accounting Information	p. 56
Comparative Accounting Systems	p. 57
Development of the Hungarian Accounting System	p. 59
Reconciling Accounting Definitions	p. 60
Data	p. 62
Some Comments on Decision-Useful Accounting Information	p. 72
Conclusion	p. 73
Reconciliation of Accounting Data	p. 75
Models, Estimation and Results	p. 81
Introduction	p. 83
Primal and Dual Approaches and Functional Forms: Production Function Estimation and Explanation	p. 85
Introduction	p. 85
Primal and Dual Functions and Choice of Functional Form	p. 86
Single Industry Level Elasticities and Factor Shares	p. 89
Yearly Cross Section Results: Industry Comparisons	p. 91
Cross-ownership Comparisons	p. 98
Conclusion	p. 104
Firm and Industry Level Efficiency Measurement using Parametric and Nonparametric, Deterministic and Stochastic Frontiers	p. 106
Introduction	p. 106
Frontier Production Functions and Efficiency Measurement	p. 107
Firm Level Efficiency Measurement	p. 115
Industry Level Efficiency Measurement	p. 120
The Frontier and Factor Proportions	p. 122
Comparative Methodologies	p. 125
Conclusion	p. 128
The Importance of Firm Size: Estimates of Returns to Scale and the Decomposition of Technical and Scale Efficiency	p. 131
Introduction	p. 131
The Problem of an Optimal Firm Size	p. 132
A Review of Enterprise Statistics	p. 135
The Identification of Scale Economies	p. 137
The Programming Approach: Pure Technical and Scale Efficiencies	p. 139
Comparison of Industry Scale Effects	p. 141
Conclusion	p. 145
Inter-temporal Consistency, Panel Data Estimation, One and Two-Factor Error Component Models	p. 147
Introduction	p. 147
The Value of Panel Data Models	p. 148
Panel Data Model Specification	p. 151
Inter-temporal Consistency	p. 153
Inter-temporal Dynamics	p. 156
Error Component Regressions	p. 158
Short and Long Run Elasticities	p. 165
Conclusion	p. 166
Inter-temporal Effects	p. 167
The Index Number Approach to Productivity, Efficiency and Technical Change; An Application to Structural Transformation	p. 171
Introduction	p. 173
Examining Changes Over Time Using Parametric and Nonparametric TFP Indices	p. 174
Introduction	p. 174
An Index of Total Factor Productivity	p. 176
Technical Progress and the Multilateral Malmquist Index	p. 186
Comparative Performance Indicators	p. 188
Conclusion	p. 193
Decomposing Productivity into Efficiency and Technical Change: Leading Sectors and the Transformation	p. 195
Introduction	p. 195
Reversing the Course of the Structural Transformation in Hungary	p. 196
New Evidence on Old Questions	p. 197
The Malmquist Index: Comparative Sector Performance in Hungary	p. 202
Leading Sectors and Structural Transformation	p. 210
Conclusion	p. 213
Conclusion	p. 216
Summary and Major Findings	p. 216
Concluding Remarks	p. 221
Bibliograph	p. 226
Table of Contents provided by Syndetics. All Rights Reserved.