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Technology shape, distance to frontier, or frontier shift? Modeling the determinants of TFP growth

Camilla Mastromarco () and Angelo Zago

No 57/2009, Working Papers from University of Verona, Department of Economics

Abstract: We investigate the determinants of TFP growth of Italian manufacturing firms. Using stochastic frontier techniques, we consider three approaches to take into account the influence of external factors, i.e., the determinants of growth. First, external factors may affect the shape of the technology. Second, they may influence the distance from the frontier. Third, in a novel approach, the external factors influence the technological progress, that is the shift of the frontier. Using a sample of manufacturing firms in 1998-2003, we find that the exports, technological investments and spillovers, public infrastructures, and banking efficiency all have a positive effect on TFP growth. We also find that the first model best fits the data.

Keywords: TFP; growth accounting; stochastic frontiers; R&D spillovers; banking efficiency; infrastructures (search for similar items in EconPapers)
JEL-codes: O47 C23 G21 H54 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eff and nep-ino
Date: 2009-09
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