Decomposition Analysis of Factor Cost Shares: The Case of Greek Agriculture

Karagiannis, Giannis; Katranidis, Stelios; Velentzas, Kostas

doi:10.1017/s1074070800007379

Cited by 4 publications

(5 citation statements)

References 25 publications

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“…We speculate that, with the new production technologies, cultivated area itself is not a decisive factor in Agricultural Production increases, but rather its effective usage, through land-saving technical change (i.e. a more productive use of land in the terms of Karagiannis et al, 1996). At a significance level of 10 percent, the contribution of immigrants to agricultural production is positive.…”

Section: Iwa Contribution To Agricultural Productionmentioning

confidence: 92%

“…In Greece, the massive influx of immigrants coincided with a crisis in agriculture. The main characteristics of this crisis, which in time became structural, involve small (<5 ha) and divided (5-6 parcel) farms, meager capital substructure, declining public infrastructure and predominantly the continuous population outflow from agriculture that reduced the local labour force (Karagiannis et al, 1996;Mamatzakis, 2003;Kasimis, 2005). Vaiou and Hatzimichalis (1997) write that illegal employment of IWA in Northern Greece kept wages and production costs down.…”

Section: Reductions Of Production Costs and Their Ramificationsmentioning

confidence: 99%

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Migrants, Economic Mobility and Socio-Economic Change in Rural Areas

Labrianidis

Sykas

2009

European Urban and Regional Studies

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This article evaluates the contribution of Immigrants Working in Agriculture (IWA) and their socio-economic mobility over time. Up to the present, European and Greek literature has focused on immigrants' impact on metropolitan areas, in part due to the relatively insignificant role of agriculture in the European economies. Moreover, concerning the socio-economic mobility of IWA only snapshot views are available in the literature. Through field-work carried out in the northern Greek countryside, reinforced by analysis of the FADN database, we argue that the influx of immigrants in the early 1990s constituted a driving force in the development of the Greek countryside in a period during which long-term structural problems in the rural sector had condemned it to relative immobility. Immigrants' contribution is articulated at three levels. First, they enabled farmers who had abandoned agriculture to re-enter the sector and, at the same time, keep their non-agricultural jobs, thus increasing their sources of income. Additionally, IWA helped active farmers to expand their holdings, and to enrich and diversify their cultivations. Second, IWA have not displaced familial agricultural employment, as this was in decline prior to their arrival. Last, their employment allowed for a more flexible combination and specialization of capital and labour in the production process. Moreover, contrary to many developed countries, immigrants in the Greek countryside have displayed upward economic mobility over time.This is due mainly to occupational mobility in the agricultural sector and a movement to non-agricultural jobs, as well as spatial mobility between rural regions, which has increased the number of days of employment and income.

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Section: Iwa Contribution To Agricultural Productionmentioning

confidence: 92%

Section: Reductions Of Production Costs and Their Ramificationsmentioning

confidence: 99%

Migrants, Economic Mobility and Socio-Economic Change in Rural Areas

Labrianidis

Sykas

2009

European Urban and Regional Studies

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“…For the purpose of the empirical application a functional form for the variable cost function should be specified. A cost function framework has also been employed in previous studies for Greek agriculture (Mergos and Yotopoulos, 1988;Karagiannis et al, 1996). For the purposes of this study, a translog specification is used (see Hazilla and Kopp, 1986;Kulatilaka, 1987;Momson, 1988):…”

Section: Empirical Modelmentioning

confidence: 99%

Sources of Productivity Change Under Temporary Equilibrium and Application to Greek Agriculture

Mergos¹,

Karagiannis

1997

J Agricultural Economics

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This paper provides a decomposition of productivity growth into its components, namely technical change, returns to scale, and disequilibrium effects of quasi-fixed factors, within a complete theoretical framework for measurement and attribution using the parametric approach. It also provides an empirical application of the framework to Greek agriculture, which has exhibited a productivity slowdown since the late 1970s. The empirical results indicate that technical change and disequilibrium effects are the main factors affecting productivity change in Greek agriculture. The contribution of the scale effect, although positive, has been quite small. The slowdown in productivity growth in Greek agriculture since the late 1970s is attributed mainly to the market disequilibrium effect of capital induced by the decline in gross capital investment.Although both aspects of productivity analysis, i.e., measurement accuracy and attribution, are desirable, the choice of the particular approach to be followed in an empirical analysis depends, also, on data availability, computational simplicity, and a priori restrictions imposed in the empirical model. The necessary data are more or less similar for all approaches. In terms of computational simplicity, the accounting approach is the easiest to implement, regardless of the number of inputs and outputs included in the analysis, whilst the complication of the non-parametric approach is positively related to the dimension of production structure in the output and input space (Diewert, 1980). In contrast, the ranking of the three approaches is reversed in terms of a priori restrictions imposed in empirical modelling. That is, most severe are the underlying assumptions of the accounting approach, whereas the non-parametric approach is more flexible in terms of functional specifications. Hence, in terms of the last two criteria, the parametric approach lies somewhere between the other two, but it has strong advantages in terms of analytical capability.Recent literature on TFP shows that considerably more research effort has been devoted to the parametric approach, implying that the computational effort required for the econometric estimation of such models has been considerably reduced with the use of flexible functional forms and duality. Nevertheless, there are certain concerns about the sensitivity of the parametric approach to alternative structural and behavioural assumptions (Callan, 1991).Accurate measures of TFP and reliable analysis of its trend can be obtained within the parametric approach only if the appropriate structural and behavioural assumptions are correctly specified. Structural assumptions of production refer to returns to scale, technical change, productive efficiency, and capacity utilisation. On the other hand, behavioural assumptions refer to the objective function of the firm, market disequilibrium effects, market structure, and the importance of various (economic and environmental) regulations.* Denny et af., (1981) established the role of technical chang...

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“…Previous literature provides a number of elasticity estimates emanating from different context and methods (e.g., Arrow et al 1961;Mundlak 1968;Berndt and Christensen 1973b;Berndt and Wood 1975;Lopez 1984;Yohe 1984;Goel 1990;Karagiannis et al 1996;Kemfert 1998;Mutairi and Burney 2002;Kaas and Thadden 2003). For U.S agriculture Binswanger (1974a) reports an elasticity of substitution of 0.85 between labor and machinery.…”

Section: Introductionmentioning

confidence: 99%

The Influence of Labor Price Change on Agricultural Machinery Usage in Chinese Agriculture

Liu

Jetté‐Nantel

et al. 2013

Canadian J Agri Economics

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The substitution between rural labor and machinery has been a key determinant of farm production, structure, and efficiency in most developed countries and is expected to play a key role in shaping the future of Chinese agriculture. Using disaggregated farm-level data from Hebei and Shandong provinces of China, we calculated the Allen and Morishima elasticities of substitution between labor and machinery. These elasticities were based on seemingly unrelated regressions and three-stage least squares estimates of the translog cost function and input cost share functions. In contrast to previous studies, we dissaggregate machinery inputs into three categories: large, medium, and small. In addition, the issue of endogeneity in output quantity and input prices is also addressed. The results show strong evidence of substitution between labor and the three categories of machinery inputs. The findings also support substitution among the three categories of machinery themselves. La substitution entre la main-d'oeuvre agricole et la machinerie constitue un déterminant fondamental de la production, de la structure et de l'efficacité des exploitations agricoles dans la plupart des pays développés et elle devrait jouer un rôle clé dans l'évolution de l'agriculture chinoise.À l'aide de données désagrégées sur les exploitations agricoles situées dans les provinces chinoises de Hebei et de Shandong, nous avons calculé lesélasticités de substitution d' Allen et de Morishima entre les facteurs de la main-d'oeuvre et de la machinerie. Le calcul de cesélasticités est basé sur des régressions apparemment indépendantes (SUR) et sur la minimisation des moindres carrés en troisétapes (3SLS). Contrairement auxétudes antérieures, nous avons subdivisé la machinerie en trois catégories : grosse, moyenne et petite. Nous avonségalement examiné l'endogénéité de la quantité d'extrants et des prix des intrants. Les résultats de notreétude illustrent clairement la substitution entre la main-d'oeuvre et les trois catégories de machinerie et appuient aussi la substitution entre les trois catégories de machinerie.

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Decomposition Analysis of Factor Cost Shares: The Case of Greek Agriculture

Cited by 4 publications

References 25 publications

Migrants, Economic Mobility and Socio-Economic Change in Rural Areas

Migrants, Economic Mobility and Socio-Economic Change in Rural Areas

Sources of Productivity Change Under Temporary Equilibrium and Application to Greek Agriculture

The Influence of Labor Price Change on Agricultural Machinery Usage in Chinese Agriculture

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