Total Factor Productivity in Korean Manufacturing Industries

Abstract

In this study, parametric and non-parametric methods are employed to measure the total factor productivity (TFP) growth in the Korean manufacturing industry from 1993 to 2003. The analysis period contains both periods before and after the Asian financial crisis. The TFP growth rate is decomposed into different components. Also different elasticities are reported. By classifying the results by period and classifying a number of time invariant firm characteristics, such as sector, size, and location of firms, we observe systematic heterogeneity for each characteristic. We discuss the underlying causal factors. The results from a non-parametric approach are also compared with those of a parametric approach.Time trend, general index, production function, total factor productivity, chained multilateral index,

The R&D and productivity relationship of Korean listed firms

“…R&D investments by SMEs in 2000 almost doubled compared to the number of R&D investments in 1997, while the increase in R&D investment by large-sized firms remained at about 3% for the two periods. The same pattern of contrast between SMEs and large-sized firms is noted in Oh et al (2008Oh et al ( , 2009, Kang and Heshmati (2008) and in a number of Research Papers (for details, refer to Seo (2002)). Seo (2002) provides a summary of the R&D activities of Korean manufacturing firms that hired at least five employees according to industry-based data for the year 2000.…”

“…Seo (2002), who used Korean data, performs a detailed study at the firm level to test empirically whether there was a structural change in R&D activities at the firm level before and after the crisis, how the role of R&D activities has changed in influencing productivity in the context of a model where production factors adjust over time to external shocks, and how and to what extent R&D activities have contributed to labor productivity. Oh et al (2008) analyzed TFP growth in Korean manufacturing industries from 1993 to 2003 using both parametric and non-parametric methods The TFP growth rate is decomposed into different components. By classifying the results by industrial sector, time period, geographic location, size class and technology levels they find systematic heterogeneity across a number of time invariant firm characteristics and discuss the underlying causal factors.…”

“…Although small-and medium-sized enterprises (SMEs) began strengthening their R&D efforts in the 1990s, the core of private sector R&D remained with largesized firms or Chaebols, at least until 1997. Recent empirical results (Oh et al 2008(Oh et al , 2009 show evidence of size/conglomerate membership effects on productivity growth. Thus, when discussing Korea's technology-based industrial policies, the performance of Chaebols and their contributions, both good and bad, cannot be avoided.…”

Effect of Work-Family Balance Policy on Job Selection and Social Sustainability: The Case of South Korea

“…We also expect significant differences in preferences for attributes according to individual characteristics such as gender, education, and income level. Additionally, in South Korea, since SMEs are mostly subcontractors of large companies, they have lower productivity and profitability [33,34]. Further, the rate of labor shortage in SMEs was 2.7% in 2014 compared with 1% in large companies, with employment in SMEs characterized by frequent turnover and short tenures; two-thirds of workers in SMEs stay for fewer than five years [35].…”

Comparison of Effects from Different Institutions: Public Credit Guarantee in Korea*

“…9 9 See the definition of input and output variables, and the detailed calculation of TFP in Oh et al. (2008).…”