Modelling cost function approach under panel data framework to estimate total factor productivity growth for the Indian manufacturing industries

Das, Narasingha and Bera, Pinki (2020): Modelling cost function approach under panel data framework to estimate total factor productivity growth for the Indian manufacturing industries. Forthcoming in: Journal of Income & Wealth (The)

Abstract

The current investigation is an endeavour to assess the total factor productivity growth (TFPG) and its components through cost-function approach for some selected organised manufacturing industries in India by utilizing the cost function approach in panel data framework throughout the year 1980-81 to 2016-17. We have found that very few studies have estimated the TFPG from cost function approach. In the recent year, no significant work has been done using panel data. In our study, we have framed a panel time-series approach to estimate the TFPG via cost-function. Our examination shows a declining trend in TFPG throughout the three decades and then the turn-around hypothesis occurs. Consequently, it might be presuming that, reforms measure adversely affects TFPG for the Indian manufacturing industries. Growth of inputs, output and Cost of all Selected Manufacturing Industries are certain throughout the decades suggested that the underutilization of existing capacity.

• Item Type: MPRA Paper
• Language: English
• Keywords: TFPG, Dual Cost function, Trans-log Cost function, Fixed Effect Modelling
• Subjects: C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C23 - Panel Data Models ; Spatio-temporal Models; C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C52 - Model Evaluation, Validation, and Selection; D - Microeconomics > D2 - Production and Organizations > D24 - Production ; Cost ; Capital ; Capital, Total Factor, and Multifactor Productivity ; Capacity

References

1. Prof. Prabirjit Sarkar, Retd. Prof. Of Economics, Jadavpur University, Visiting Fellow, UMASS MA(USA) and CBR Cambridge (UK), UMASS 418, N Pleasant Road, Amherst MA 01002, USA, Contact No.- [phone], email- prabirjit @gmail.com 2. Dr. Bibhas Saha, Associate Professor of Economics in the Business School, Durham University,Stockton Road, Durham DH1 3LE, UK, Contact No.- [phone], Room number: MHL 143, email- [e-mail] 3. Sr. Prof. Purnendu Sekhar Das. Retd. Prof. Of Economics, Indian Institute of Technology [Kharagpur] (Binod Gupta Institute of Management), West Bengal, India, Contact No.- [phone], email- [e-mail]