The Impact of Technical Efficiency on Productivity Growth: Evidence from the Korean Pharmaceutical Industry

Mikyung Yun

The Economic Record, 2025, vol. 101, issue S1, 26-49

Abstract: This study examines the effects of technological capability, technological spillovers, and technological gap on firm‐level productivity growth in the Korean pharmaceutical industry over the period 2000‐2023. Utilizing the generalized true random effects (GTRE) stochastic frontier analysis, this article estimates technical efficiency to serve as a proxy for the technological gap. The results indicate that technological divergence is the primary driver of inter‐firm productivity polarization, with limited evidence of technological spillovers from frontier firms to laggards. These findings support the low technological capability hypothesis over the Schumpeterian catch‐up hypothesis, which posits convergence through innovation diffusion. The study further highlights that, even at the frontier, intra‐firm technological diffusion can be sluggish under conditions of rapid technological change. It underscores the importance of intra‐firm diffusion, characterized by distinct mechanisms from inter‐firm diffusion, as a key determinant of productivity growth alongside inter‐firm technological divergence.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/1475-4932.70001

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:ecorec:v:101:y:2025:i:s1:p:26-49

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0013-0249

Access Statistics for this article

The Economic Record is currently edited by Paul Miller, Glenn Otto and Martin Richardson

More articles in The Economic Record from The Economic Society of Australia Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().