Dr. Eric Njuki, University of Connecticut
Seminar Title: "Accounting for Technological and Environmental Heterogeneity in U.S. Agricultural Productivity Using Random Parameters"
Abstract:
The objective of this study is to investigate the effects of random weather fluctuations and other environmental factors on U.S. agricultural productivity growth. In doing so we make four key contributions. First, we conjecture that firms face distinct production possibilities primarily because their production technologies and the characteristics of their production environment are heterogeneous. In contrast, the received literature assumes that firms have access to the same production possibilities and only differ with respect to their level of efficiency. Second, with a few exceptions, studies that decompose total factor productivity (TFP) growth do so while ignoring the role of weather anomalies and other environmental factors. This study unambiguously incorporates weather shocks and other environmental factors in the decomposition of TFP. Third, a number of studies that analyze productivity rely on flexible functional forms, such as the translog. The advantage of using flexible functional forms is their ability to provide second-order approximations of any twice-differentiable production functions. Unfortunately, flexible functional forms such as the translog fail to satisfy curvature properties globally. We propose the use of a random parameters Cobb-Douglas that has the virtue of providing flexibility while preserving fundamental theoretical properties. Fourth, this study demonstrates how to use coefficient estimates generated using a random parameters to decompose a multiplicative TFP index.
Friday, November 03, 2017
11:30am - 12:45pm
W.B. Young Building, room 132
View the full Fall 2017 ARE Seminar Schedule
For more information, contact: Tatiana Andreyeva at tatiana.andreyeva@uconn.edu