On Productivity: The Influence of Natural Resource Inputs
The production function underlying standard estimates of multifactor productivity (MFP) typically restricts the list of explicitly measured inputs to capital, labour and intermediate inputs (energy, materials and services). These inputs are measured in the national accounts, and in most industries a...
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| Format: | Article |
| Language: | English |
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Centre for the Study of Living Standards
2014-09-01
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| Series: | International Productivity Monitor |
| Subjects: | |
| Online Access: | http://www.csls.ca/ipm/27/27-vttk.pdf |
| _version_ | 1811333957382307840 |
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| author | Vernon Topp Tony Kulys |
| author_facet | Vernon Topp Tony Kulys |
| author_sort | Vernon Topp |
| collection | DOAJ |
| description | The production function underlying standard estimates of multifactor productivity (MFP) typically restricts the list of explicitly measured inputs to capital, labour and intermediate inputs (energy, materials and services). These inputs are measured in the national accounts, and in most industries are the most important or significant inputs to production. All other influences on output are captured by the MFP ‘residual.’ However in some industries – mining, agriculture, and utilities – output can also depend significantly on unmeasured inputs of natural resources. Rainfall in agriculture is an obvious example, but so too is the issue of mineral resource deposits in the mining sector, particularly where mining is a mature industry and the richest and most accessible deposits have already been developed. In this article we attribute a substantial part of recent large negative changes in MFP growth in the mining, agriculture and utilities industries in Australia to unmeasured natural resource input changes. As MFP growth estimates derived from the application of the usual production function are generally interpreted as measuring improvements in the ‘technology’ used to convert standard inputs into output, where there are significant changes in natural resource dependent industries this interpretation of MFP needs to be adjusted. |
| first_indexed | 2024-04-13T17:00:35Z |
| format | Article |
| id | doaj.art-a7827156a12748a4a822b7497d5ccc00 |
| institution | Directory Open Access Journal |
| issn | 1492-9759 1492-9767 |
| language | English |
| last_indexed | 2024-04-13T17:00:35Z |
| publishDate | 2014-09-01 |
| publisher | Centre for the Study of Living Standards |
| record_format | Article |
| series | International Productivity Monitor |
| spelling | doaj.art-a7827156a12748a4a822b7497d5ccc002022-12-22T02:38:41ZengCentre for the Study of Living StandardsInternational Productivity Monitor1492-97591492-97672014-09-01276478On Productivity: The Influence of Natural Resource InputsVernon Topp0Tony Kulys1Australian Productivity CommissionAustralian Productivity CommissionThe production function underlying standard estimates of multifactor productivity (MFP) typically restricts the list of explicitly measured inputs to capital, labour and intermediate inputs (energy, materials and services). These inputs are measured in the national accounts, and in most industries are the most important or significant inputs to production. All other influences on output are captured by the MFP ‘residual.’ However in some industries – mining, agriculture, and utilities – output can also depend significantly on unmeasured inputs of natural resources. Rainfall in agriculture is an obvious example, but so too is the issue of mineral resource deposits in the mining sector, particularly where mining is a mature industry and the richest and most accessible deposits have already been developed. In this article we attribute a substantial part of recent large negative changes in MFP growth in the mining, agriculture and utilities industries in Australia to unmeasured natural resource input changes. As MFP growth estimates derived from the application of the usual production function are generally interpreted as measuring improvements in the ‘technology’ used to convert standard inputs into output, where there are significant changes in natural resource dependent industries this interpretation of MFP needs to be adjusted.http://www.csls.ca/ipm/27/27-vttk.pdfmultifactor productivitylabour productivitynatural resourceseconomy |
| spellingShingle | Vernon Topp Tony Kulys On Productivity: The Influence of Natural Resource Inputs International Productivity Monitor multifactor productivity labour productivity natural resources economy |
| title | On Productivity: The Influence of Natural Resource Inputs |
| title_full | On Productivity: The Influence of Natural Resource Inputs |
| title_fullStr | On Productivity: The Influence of Natural Resource Inputs |
| title_full_unstemmed | On Productivity: The Influence of Natural Resource Inputs |
| title_short | On Productivity: The Influence of Natural Resource Inputs |
| title_sort | on productivity the influence of natural resource inputs |
| topic | multifactor productivity labour productivity natural resources economy |
| url | http://www.csls.ca/ipm/27/27-vttk.pdf |
| work_keys_str_mv | AT vernontopp onproductivitytheinfluenceofnaturalresourceinputs AT tonykulys onproductivitytheinfluenceofnaturalresourceinputs |