Regional variation in productivity

Arnab Bhattacharjee, Eduardo de Castro, Chris Jensen-Butler

    Research output: Contribution to journalArticle

    7 Citations (Scopus)

    Abstract

    We develop a model of labor productivity as a combination of capital-labour ratio, vintage of capital stock, regional externalities, and total factor productivity (TFP). The skewness of TFP distribution is related to different growth theories. While negative skewness is consistent with the neo-Schumpeterian idea of catching up with leaders, zero skewness supports the neoclassical view that deviations from the frontier reflect only idiosyncratic productivity shocks. We argue that positive skewness is consistent with an economy where exogenous technology is combined with non-transferable knowledge accumulated in specific sectors and regions. This argument provides the framework for an empirical model based on stochastic frontier analysis. The model is used to analyse regional and sectoral inequalities in Denmark. © 2009 Springer Science+Business Media, LLC.
    Original languageEnglish
    Pages (from-to)195-212
    Number of pages18
    JournalJournal of Productivity Analysis
    Volume31
    Issue number3
    DOIs
    Publication statusPublished - 2009

    Keywords

    • regional growth models
    • total factor productivity
    • stochastic frontier analysis
    • skewness
    • technological trajectories
    • D24
    • O18
    • O3
    • O4

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