Ca Knox Lovell

Ca Knox Lovell
The University of Queensland | UQ · Centre for Efficiency and Productivity Analysis

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229
Publications
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Publications

Publications (229)
Chapter
In this paper, we characterize local circularity for the Laspeyres, Paasche, and Fisher price indexes. In the first two cases, we begin by deriving a sufficient condition for achieving circularity that establishes that at least one of two proposed equalities must hold. We end up showing that the sufficient condition is also necessary. We continue w...
Article
A primal (or direct) productivity index is conventionally defined as the ratio of an output quantity index to an input quantity index. There have been attempts in the literature to define and implement dual and indirect productivity indexes based on price changes rather than quantity changes. Although dual and indirect productivity indexes share a...
Chapter
We begin by providing contextual background for this book, the second in a series. We continue by proclaiming the importance of efficiency and productivity, for businesses, industries and nations. We then summarise the chapters in the book, which consist of an equal number of advances in the analytical foundations of efficiency and productivity mea...
Book
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This book surveys the state-of-the-art in efficiency and productivity analysis, examining advances in the analytical foundations and empirical applications. The analytical techniques developed in this book for efficiency provide alternative ways of defining optimum outcome sets, typically as a (technical) production frontier or as an (economic) cos...
Article
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A natural multiplicative efficiency measure for the Constant Returns to Scale Proportional Directional Distance Function (pDDF) is derived, relating its associated linear program to that of the well-known output-oriented radial efficiency measurement model. Based on this relationship, a traditional CCD (Caves, Christensen and Diewert) Malmquist ind...
Article
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We revisit the recently revived concept of social economic progress. We take a microeconomic perspective and address economic progress where it originates, with value creation at individual businesses. We begin with a brief history of thought on the concept. We continue by analyzing how a business creates private value through productivity growth,...
Chapter
This chapter provides a wide-ranging interdisciplinary overview of productivity analysis, which also serves to introduce the chapters in the Handbook. It begins with an exploration into the significance of productivity growth, for business, for the economy, and for social economic progress. The chapter continues with a treatment of how productivity...
Chapter
This chapter explores the relationship between productivity and financial performance, primarily at the level of an individual business. It begins by decomposing profit change into price and quantity drivers, under alternative accounting treatments of operating surplus. The chapter considers a range of related issues, including the drivers of produ...
Book
This book discusses energy use and its environmental footprint in China, as well as issues concerning the transitional green growth of its economy, a subject of great importance in light of China’s size and its impressive record of economic growth. The book includes expert overviews and empirical studies prepared by internationally recognized exper...
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Global greenhouse gas emissions have increased at a rate of nearly 2% per year since 1970, and the rate of increase has been increasing. The contribution of greenhouse gases to global warming constitutes an environmental management challenge requiring interdisciplinary effort and international cooperation. In an effort to meet this challenge, the K...
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This paper embodies three goals. First, it develops a student expectations and preference questionnaire (SEPQ). Second, factor analysis identifies dimensions within student responses. Third, instrumental variable (IV) approach explores the determinants of these dimensions. Using a 59-item SEPQ and 506 student responses at a leading Australian unive...
Chapter
We begin by providing some historical background behind this book. We continue by discussing the significance of the three operative words in the title of the book—advances, efficiency and productivity. We then briefly summarize the chapters in the book, which divide into advances in the analytical foundations of efficiency and productivity, and ad...
Chapter
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We analyse stream health and some of its likely influences for a sample of 30 sites in 16 urban sub-catchments located in the Lower Brisbane River catchment and surrounding coastal catchments in southeast Queensland, Australia. We measure stream health with macroinvertebrate and fish diversity and abundance indicators. We specify three influences o...
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We develop exact relationships between empirical Fisher indexes and their theoretical Malmquist and Konüs counterparts. We begin by using implicit Malmquist price and price recovery indexes to establish exact relationships between empirical Fisher quantity and productivity indexes and theoretical Malmquist quantity and productivity indexes. We then...
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I provide a selective and idiosyncratic examination of several recent, and in some cases not-so-recent, developments in productivity analysis that I find interesting. Some have been influential, among them being an analysis of the linkage between management and productivity, an analysis of productivity dispersion (or productivity gaps) and producti...
Article
University student populations in the developed world embody more personal, social, cultural, and intellectual diversity than their predecessors a quarter century ago. The existing literature is less clear about dimensions of students’ study practices and how variables that underpin this diversity shape them. This study fills this gap in three ways...
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We consider productivity measurement based on radial DEA models with a single constant input. We show that in this case the Malmquist and the Hicks-Moorsteen productivity indices coincide and are multiplicatively complete, the choice of orientation of the Malmquist index for the measurement of productivity change does not matter, and there is a uni...
Book
Productivity Accounting. The Economics of Business Performance by professors E. Grifell-Tatjé and C.A.K. Lovell (Cambridge University Press) offers an in-depth analysis of productivity performance. The book provides an analytical framework within which to account for productivity performance, and also to account for its causes and its consequences....
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Mining and fishing are both extractive industries, although one resource is renewable and the other is not. Miners and fishers pursue financial objectives, although their objectives may differ. In both industries financial performance is influenced by productivity and prices. Finally, in both industries capacity constraints influence financial perf...
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A recent Australian Productivity Commission Staff Working Paper has estimated a 25 % decline in value added total factor productivity in Australian coal mining over the period 2000/2001–2006/2007. The decline coincides with a period of rapidly increasing global demand for, and price of, coal, which has made it economically feasible to mine coal tha...
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Gerard Debreu introduced a well known radial efficiency measure which he called a “coefficient of resource utilization.” He derived this scalar from a much less well known “dead loss” function that characterizes the monetary value sacrificed to inefficiency, and which is to be minimized subject to a normalization condition. We use Debreu’s loss fun...
Article
The product test asks the product of the volume and price index numbers to equal the corresponding value change. The literature treats the product test as a requirement. We treat it as a hypothesis, and we provide an empirical test.
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We discuss four frequently overlapping developments in the brief history of efficiency analysis. The developments involve modes of invention, graduate students, international travel, and influential but under-appreciated scholars. We suggest lessons to be learned from each. KeywordsEfficiency–SFA–DEA
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In this paper we introduce a new Malmquist productivity index that has three attractive features: it avoids linear programming infeasibilities under variable returns to scale, it allows for technical regress, and it does not need to be recomputed when a new time period is added to the data set. The proposed index is compared to both the adjacent Ma...
Article
This paper examines how productivity changes and price changes have contributed to short-run profit change in the railroad industry. Using an unbalanced panel of US Class I railroads for the period 1996-2003, a short-run profit change decomposition model is used to attribute intertemporal profit change to its causal factors. We find that productivi...
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This study employs data drawn from the 2000 Agricultural Resource Management Survey, a U.S. Department of Agriculture-sponsored farmers’ survey. The article estimates returns to scale relationships across dairy farms of different sizes and across different regions, incorporating variables hypothesized to influence farm performance. Results point to...
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We introduce new specifications and estimation procedures of traditional distance functions that allow researchers to undertake environmental efficiency and productivity studies within a parametric stochastic framework. Relying on a translog distance function specification that treats the outputs' vector asymmetrically by allowing equiproportional...
Article
The literature to date on the effect of demand uncertainty on public hospital costs and excess capacity has not taken into account the role of expense preference behaviour. Similarly, the research on expense preference behaviour has not taken demand uncertainty into account. In this paper, we argue that both demand uncertainty and expense preferenc...
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In this study we propose a methodology that allows one to obtain consistent estimates of a system of equations involving an input distance function along with the first order equations that relate to shadow cost minimizing behaviour. In addition, we show that previously proposed methods are likely to produce inconsistent estimates, even under a fai...
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We study the economic, financial and distributional performance of the United States Postal Service subsequent to its 1971 reorganization. We investigate the economic sources of productivity change, (technical change, change in cost efficiency, and scale economies), and the distribution of the financial benefits of productivity change (consumers of...
Article
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This paper examines how productivity changes contribute to short-run cost variations over time and across railroads. Using an unbalanced panel of US Class I railroad data for the period 1996-2003, decomposition models were used to attribute intertemporal and multilateral cost variations to their causal factors. We find that (i) railroads were able...
Article
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The flexibility of weights assigned to inputs and outputs is a key aspect of DEA modeling. However, excessive weight variability and implausible weight values have led to the development of DEA models that incorporate weight restrictions, reflecting expert judgment. This in turn has created problems of infeasibility of the corresponding linear prog...
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We use a flexible parametric hyperbolic distance function to estimate environmental efficiency when some outputs are undesirable. Cuesta and Zofio (J. Prod. Analysis (2005), 31-48) introduced this distance function specification in conventional input-output space to estimate technical efficiency within a stochastic frontier context. We extend their...
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The geometric mean version of the Malmquist productivity index does not satisfy the circular test, and its component adjacent period indexes can give different productivity change measures for the same data. A fixed-base version of the index solves both problems, but it is not independent of the base period. It has been argued that time-neutrality...
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We evaluate the financial performance of most of the branch offices of a large European savings bank for a recent accounting period. We employ a complementary pair of nonparametric techniques to evaluate their financial performance, in terms of their ability to conserve on the expenses they incur in building their customer bases and providing custo...
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This study uses a new dataset based on the 2000 Agricultural Resource Management Survey, the most recent national survey of dairy producers in the United States. A shadow cost function is employed to decompose and analyze economic efficiency and scale economies. The study details the development of the data employed in the analysis and focuses on t...
Article
The twenty-two papers collected in this volume illustrate the itinerary of Henry Tulkens, an applied theorist, on the occasion of his retirement from teaching. The collection is structured in four parts: I. Decentralized resource allocation processes for public and private goods - II. Environment, public goods and externalities - III. Efficiency an...
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Frontier techniques can be of immense use in establishing the best practice benchmarks against which the performance of healthcare providers can be evaluated. If credible benchmarks are set by frontier techniques, then reimbursement schemes can be guided by the performance of individual providers. Although frontier techniques have gained acceptance...
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In a healthcare system, resource allocation mechanisms should promote efficiency, improve quality of care and reduce practice variation. This paper presents a framework that has been used at the US Department of Veterans Affairs, VA Healthcare Network Upstate New York, to guide resource allocation and productivity assessment since 1999. It synthesi...
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The geometric mean Malmquist productivity index is not circular, and its adjacent period components can provide different measures of productivity change. We propose a global Malmquist productivity index that is circular, and that gives a single measure of productivity change.
Article
We consider the lack of consensus about an appropriate theoretical framework linking sub-indicators as a defining characteristic of composite indicators. This intrinsic feature implies uncertainties about the appropriate normalization and aggregation of the raw data. The two are related: index theory offers some valuable guidelines about their conn...
Article
In this paper, we present a new empirical model based on an input distance function, from which estimates of allocative inefficiency and its cost can be obtained. The model avoids the “Greene problem,” which refers to the difficulty in practice of using a cost system to separate economic inefficiency into its technical and allocative components. We...
Article
Most theoretical and empirical research on cooperatives focuses on the comparative statics behavior of optimizing cooperatives. We focus on the magnitude and sources of variation in the dividend that cooperatives are presumed to maximize. Variation in the dividend leads to an inefficient allocation of labor among cooperatives. For a panel of 59 Spa...
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In 2002, the World Health Organization published a health system performance ranking for 191 member countries. The ranking was based on five indicators, with fixed weights common to all countries. We investigate the feasibility and desirability of using mathematical programming techniques that allow weights to vary across countries to reflect their...
Data
Annex 1: Definition of facility types as coded in the unit cost database. Annex 2: Percentage of missing data in the model variables prior to data imputation. Annex 3: Countries and number of unit cost observations included in the model.
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Agricultural production is known to have environmental impacts, both adverse and beneficial, and it is desirable to incorporate at least some of these impacts in an environmentally sensitive productivity index. In this paper, we construct indicators of water contamination from the use of agricultural chemicals. These environmental indicators are me...
Article
The aim of this paper is to study excess capacity in National Health System (NHS) hospitals, which have the characteristics of a bureaucracy, within a theoretically consistent framework. In this sense, we develop and estimate an empirical model which has not previously been applied to this problem. This model, based on an input distance function, i...
Article
In this presentation I view a Malmquist productivity index as a theoretical index with desirable properties. I then discuss the properties of three approximations to it: an empirical Malmquist index, and Fisher and Tornqvist indexes. Next I discuss the decomposition properties of the theoretical Malmquist index and its three approximations. I concl...
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Two different Malmquist productivity indexes have been proposed. One I call partially oriented because it is either output‐ or input‐oriented, and the other is simultaneously output‐ and input‐oriented. The partially oriented Malmquist index owes some of its popularity to the fact that it has been decomposed to isolate various sources of productivi...
Article
Since engineering information is rarely available, standard practice is to benchmark managerial performance against best observed practice. We exploit a rare opportunity to benchmark managerial performance against engineering standards. Our managerial performance describes the activities of Spanish electricity distributors, and our engineering stan...
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DEA super-efficiency models were introduced originally with the objective of providing a tie-breaking procedure for ranking units rated as efficient in conventional DEA models. This objective has been expanded to include sensitivity analysis, outlier identification and inter-temporal analysis. However, not all units rated as efficient in convention...
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In this article, we develop and implement a methodology for analyzing the sources of variation in environmental efficiency across producers. We formulate a two-stage model. In the first stage, we use stochastic frontier analysis to estimate both technical and environmental efficiency. In the second stage, we again use stochastic frontier analysis t...
Article
This paper analyses electricity generation in four Australian states and the Northern Territory in the late 1990s It finds that productivity growth estimates for electricity generators can change significantly when allowance is made for greenhouse gas emissions. Using an innovative analytical technique for incorporating environmental impacts in pro...
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In this paper we propose a new technique for incorporating environmental effects and statistical noise into a producer performance evaluation based on data envelopment analysis (DEA). The technique involves a three-stage analysis. In the first stage, DEA is applied to outputs and inputs only, to obtain initial measures of producer performance. In t...
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Economists, management scientists and public administration scholars have long been interested in the assessment of the performance of the public sector, and in the identification of the likely determinants of performance variation, both across jurisdictions and through time. Their interest is well placed, and motivated by a number of factors.
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Annual growth rates of real GDP in New Zealand have varied widely, from 18% to –8%, since World War II. During this period the tax burden (the ratio of tax revenue to GDP) has trended upward from 23% to 35%. The tax mix (the ratio of indirect taxes to direct taxes) has varied between 0.31 and 0.75, having increased recently with the introduction of...
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Hyperbolic measures of efficiency and productivity change with respect to a graph representation of production technology allow researchers to consider output and input dimensions simultaneously in measuring producer performance. Hyperbolic efficiency measures have been proposed, but empirical implementation has not followed, either in efficiency a...
Article
‘Greenhouse Gas Emissions and the Productivity Growth of Electricity Generators’ by Greg Murtough, David Appels, Anna Matysek, and C. A. Knox Lovell, was released on 18 December 2001. This paper develops and applies a measure of productivity growth that can incorporate unpriced environmental impacts. The methodology builds on the established...
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The objective of this paper is to estimate comprehensive environmental efficiency measures for Dutch dairy farms. The environmental efficiency scores are based on the nitrogen surplus, phosphate surplus and the total (direct and indirect) energy use of an unbalanced panel of dairy farms. We define environmental efficiency as the ratio of minimum fe...
Article
This study develops an analytical model capable of decomposing both intertemporal and multilateral cost variation. It begins by attributing cost variation to a price effect and a quantity effect. Then the quantity effect is decomposed into a productivity effect and an activity effect. The productivity effect in turn decomposes into a cost efficienc...
Chapter
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The widely heralded liberalization of New Zealand’s economy began in the early 1980s. The reforms were both macroeconomic and microeconomic in scope. The former included changes in the conduct of fiscal and monetary policy. Among the latter were liberalization of international trade, deregulation of domestic industrial, agricultural, finance and la...