SSE/EFI Working Paper Series in Economics and Finance
No 394:
Productivity Growth, Efficiency and Outsourcing in Manufacturing and Service Industries
Almas Heshmati ()
Abstract: This paper is a survey of recent contributions to, and
developments of, the relationship between outsourcing, efficiency and
productivity growth in manufacturing and services. The objective is to
provide a thorough and up-to-date survey that provides a significant
discussion on data, as well as on the core methods of measuring efficiency
and productivity. First, the readers are introduced to the measurement of
partial and total factor productivity growth. Different parametric and
non-parametric approaches to the productivity measurement in the context of
static, dynamic and firm-specific modelling are discussed. Second, we
survey the econometric approach to efficiency analysis. The issues of
modelling, distributional assumptions and estimation methods are discussed
assuming that cross-sectional or panel data are available. Third, the
relationship between outsourcing and productivity growth in manufacturing
and services is discussed. The correspondence between a number of
hypotheses and empirical findings are examined. Examples of varieties of
relevant empirical applications, their findings and implications are
presented. Fourth, measurement of inputs and outputs in manufacturing and
services are discussed. Finally, to promote useful research, a number of
factors important to the analysis of outsourcing, efficiency and
productivity growth in the service sector are summarised.
Keywords: Total factor productivity growth; technical efficiency; outsourcing; technical change; returns to scale; firms; manufacturing; services; measurement of inputs and outputs; (follow links to similar papers)
JEL-Codes: C20; D24; G20; L60; O47; (follow links to similar papers)
43 pages, August 14, 2000, Revised October 18, 2001
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- This paper is published as:
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Heshmati, Almas, (2003), 'Productivity Growth, Efficiency and Outsourcing in Manufacturing and Service Industries', Journal of Economic Surveys, Vol. 17, No. 1, pages 79-112
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