Productivity, Efficiency and Economic Growth: East Asia and the Rest of the World

UC Santa Cruz Economics Working Paper No. 536

24 Pages Posted: 28 Apr 2003

See all articles by Gaofeng Han

Gaofeng Han

Hong Kong Monetary Authority; University of California, Santa Cruz - Department of Economics

Kaliappa Kalirajan

Foundation for Advanced Studies on International Development (FASID)

Nirvikar Singh

University of California, Santa Cruz

Date Written: 2003

Abstract

This study compares the sources of growth in East Asia with the rest of the world, using a methodology that allows one to decompose total factor productivity (TFP) growth into technical efficiency changes (catching up) and technological progress. It applies a varying coefficients frontier production function model to aggregate data for the period 1970-1990, for a sample of 45 developed and developing countries. Our results are consistent with the view that East Asian economies were not outliers in terms of TFP growth. Of the high-performing East Asian economies, our methodology identifies South Korea as having the highest TFP growth, followed by Singapore, Taiwan and Japan. Our methodology also allows us to separately estimate technical efficiency change, which is a component of TFP growth, and we find that, in general, the estimated technical efficiency of the high-performing East Asian economies was not out of line with the rest of the world.

Keywords: Total factor productivity growth, technical efficiency change, technical progress, sources of growth, varying coefficients frontier production functions

JEL Classification: C21, O30, O47

Suggested Citation

Han, Gaofeng and Kalirajan, Kaliappa and Singh, Nirvikar, Productivity, Efficiency and Economic Growth: East Asia and the Rest of the World (2003). UC Santa Cruz Economics Working Paper No. 536, Available at SSRN: https://ssrn.com/abstract=385581 or http://dx.doi.org/10.2139/ssrn.385581

Gaofeng Han

Hong Kong Monetary Authority ( email )

3 Garden Road, 30th Floor
Hong Kong
Hong Kong

University of California, Santa Cruz - Department of Economics ( email )

Santa Cruz, CA 95064
United States

Kaliappa Kalirajan

Foundation for Advanced Studies on International Development (FASID)

1-6-17 Kudan Minami, Chiyoda-ku
Tokyo 162-8677
Japan

Nirvikar Singh (Contact Author)

University of California, Santa Cruz ( email )

Department of Economics
E2 Building
Santa Cruz, CA 95064
United States
831-459-4093 (Phone)
831-459-5077 (Fax)

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