Abstract
The Luenberger productivity indicator has many attractive features to evaluate productivity, technical and efficiency changes. Paralleling Färe et al. (1997), this paper shows that the technical change indicator can be expressed as the sum of a magnitude indicator and a bias indicator that is the sum of two bias indicators input and output oriented respectively. Using a recent concept of ``parallel neutrality'' introduced by Briec et al. (2006), some conditions under which each bias indicator makes no contribution to productivity change are established. Among the key contributions of this paper is a new linear programming model involving a graph translation homotheticity property.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
References
Blackorby C. D., Lovell C. A. K. and Thursby M. (1976). Extended Hicks Neutral Technical Change. Economic Journal 86: 845–52
Briec W., Chambers R. G., Färe R. and Peypoch N. (2006). Parallel Neutrality. Journal of Economics 88: 285–305
Chambers, R. G. (1996): “A New Look at Exact Input, Output, and Productivity Measurement.” Working paper 96-05, Department of Agricultural and Resource Economics, University of Maryland.
Chambers R. G. (2002). Exact Non Radial Input, Output and Productivity Measurement. Economic Theory 20: 751–65
Chambers R. G., Chung Y. and Färe R. (1996). Benefit and Distance Functions. Journal of Economic Theory 70: 407–19
Chambers R. G., Chung Y. and Färe R. (1998). Profit, Directional Distance Functions, and Nerlovian Efficiency. Journal of Optimization Theory and Applications 98: 351–64
Chambers R. G. and Färe R. (1994). Hicks Neutrality and Trade Biased Growth: A Taxonomy. Journal of Economic Theory 64: 554–67
Chambers R. G. and Färe R. (1998). Translation Homotheticity. Economic Theory 11: 629–41
Charnes A., Cooper W. W. and Rhodes E. (1978). Measuring the Efficiency of Decision Making Units. European Journal of Operational Research 2: 429–44
Färe R., Grifell-Tatjé E., Grosskopf S. and Lovell C. A. K. (1997). Biased Technical Change and the Malmquist Productivity Index. Scandinavian Journal of Economics 99: 119–27
Färe, R., and Grosskopf, S. (1996): Intertemporal Production Frontiers: With Dynamic DEA. Kluwer Academic Publishers.
Färe, R., and Grosskopf, S. (2004): New Directions: Efficiency and Productivity. Kluwer Academic Publishers.
Färe R., Grosskopf S. and Lee W. F. (2001). Productivity and Technical Change: The Case of Taiwan. Applied Economics 33: 1911–25
Färe R., Grosskopf S., Norris M. and Zhang Z. (1994). Productivity Growth, Technical Progress, and Efficiency Changes in Industrial Country. American Economic Review 84: 66–83
Luenberger D. G. (1992). Benefit Function and Duality. Journal of Mathematical Economics 21: 461–81
Weber W. L. and Domazlicky B. R. (1999). Total Productivity Growth in Manufacturing: A Regional Approach Using Linear Programming. Regional Science and Urban Economics 29: 105–122
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Briec, W., Peypoch, N. Biased Technical Change and Parallel Neutrality. J Econ 92, 281–292 (2007). https://doi.org/10.1007/s00712-007-0262-6
Received:
Revised:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s00712-007-0262-6
Keywords
- directional distance function
- Luenberger productivity indicator
- parallel neutrality
- graph translation homotheticity property