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LABOR PRODUCTIVITY GROWTH AND CONVERGENCE IN THE KANSAS FARM SECTOR: A TRIPARTITE DECOMPOSITION USING THE DEA APPROACH

Amin William Mugera, Michael R. Langemeier

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Abstract

The objective of this paper is to analyze sources of labor productivity growth in the Kansas farm sector over the period 1993-2006 for a sample of 668 farms. The nonparametric production frontier method is used to decompose labor productivity growth into three components: (1) technological catch-up, (2) technological change, and (3) capital deepening. Kernel estimation methods are used to analyze the evolution of the entire distribution of labor productivity in the sample period. We find that labor productivity is primarily driven by capital deepening. On average, capital deepening is the main source of convergence in productivity and technical change is a source of divergence. We find little evidence of technological catch-up. The impact of the three components of labor productivity varies by farm size.

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What this paper is about

The objective of this paper is to analyze sources of labor productivity growth in the Kansas farm sector over the period 1993-2006 for a sample of 668 farms. The nonparametric production frontier method is used to decompose labor productivity growth into three components: (1) technological catch-up, (2) technological change, and (3) capital deepening. Kernel estimation methods are used to analyze the evolution of the entire distribution of labor productivity in the sample period. We find that labor productivity is primarily driven by capital deepening. On average, capital deepening is the main source of convergence in productivity and technical change is a source of divergence. We find little evidence of technological catch-up. The impact of the three components of labor productivity varies by farm size.

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Available abstract

The objective of this paper is to analyze sources of labor productivity growth in the Kansas farm sector over the period 1993-2006 for a sample of 668 farms. The nonparametric production frontier method is used to decompose labor productivity growth into three components: (1) technological catch-up, (2) technological change, and (3) capital deepening. Kernel estimation methods are used to analyze the evolution of the entire distribution of labor productivity in the sample period. We find that labor productivity is primarily driven by capital deepening. On average, capital deepening is the main source of convergence in productivity and technical change is a source of divergence. We find little evidence of technological catch-up. The impact of the three components of labor productivity varies by farm size.

Key concepts: Productivity, Economics, Convergence (economics), Solow residual, Technological change, Production–possibility frontier, Sample (material), Technical change

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LABOR PRODUCTIVITY GROWTH AND CONVERGENCE IN THE KANSAS FARM SECTOR: A TRIPARTITE DECOMPOSITION USING THE DEA APPROACH — Research Paper | ScholarLens