Robust nonparametric analysis of dynamic profits, prices and productivity: An application to French meat-processing firms

Abstract

Appropriately considering adjustment costs, this paper develops a robust nonparametric framework to analyse profits, prices and productivity in a dynamic context. Dynamic profit change is decomposed into a dynamic Bennet price indicator and a dynamic Bennet quantity indicator. The latter is decomposed into explanatory factors. It is shown to be a superlative indicator for the dynamic Luenberger indicator. The application focuses on 1,638 observations of French meat-processing firms for the years 2012–2019. Using m-out-of-n bootstrapped data envelopment analysis, we obtain robust estimates and confidence intervals. The components of dynamic productivity growth fluctuate substantially. However, these fluctuations are often statistically insignificant.

Publication
European Review of Agricultural Economics 50 (2): 771-809, 2023
Date