Luenberger and Malmquist Productivity Indices: Theoretical Comparisons and Empirical Illustration

Luenberger and Malmquist Productivity Indices: Theoretical Comparisons and Empirical Illustration This contribution establishes, from a theoretical viewpoint, the relations between the Malmquist productivity indices, that measure in either input or output orientations, and the Luenberger productivity indices, that can simultaneously contract inputs and expand outputs, but that can also measure in either input or output orientations. The main result is that a Malmquist productivity index overestimates productivity changes, since it provides productivity measures that are nearly twice those given by the Luenberger productivity index looking for simultaneous contractions of inputs and expansions of outputs. This relationship is empirically illustrated using data from 20 OECD countries over the 1974–97 period. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Bulletin of Economic Research Wiley

Luenberger and Malmquist Productivity Indices: Theoretical Comparisons and Empirical Illustration

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Publisher
Wiley
Copyright
Copyright © 2003 Wiley Subscription Services, Inc., A Wiley Company
ISSN
0307-3378
eISSN
1467-8586
D.O.I.
10.1111/1467-8586.00183
Publisher site
See Article on Publisher Site

Abstract

This contribution establishes, from a theoretical viewpoint, the relations between the Malmquist productivity indices, that measure in either input or output orientations, and the Luenberger productivity indices, that can simultaneously contract inputs and expand outputs, but that can also measure in either input or output orientations. The main result is that a Malmquist productivity index overestimates productivity changes, since it provides productivity measures that are nearly twice those given by the Luenberger productivity index looking for simultaneous contractions of inputs and expansions of outputs. This relationship is empirically illustrated using data from 20 OECD countries over the 1974–97 period.

Journal

Bulletin of Economic ResearchWiley

Published: Oct 1, 2003

References

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