We analyse the productivity growth patterns in the US dairy products industry using the Census Bureau's plant-level data set. We decompose Total Factor Productivity (TFP) growth into the scale and technical change components and analyse variability of plants’ productivity by constructing
transition matrices. We observe a cross-sectional dispersion in plant-level productivity growth in the industry. Even though the industry aggregate shows a small TFP growth rate −0.3%, quartile rank analysis shows that while the lowest productivity quartile plants average 1.9% loss in
productivity, the highest productivity quartile plants average 1.1% growth annually. Our results show considerable movements of plants in their productivity rank categories overall and across age groups, and we find that the scale effect contribution to TFP growth accounts for about 90% of
TFP growth on average in the industry. These plants extract scale efficiencies over technological progress to fuel TFP growth. The youngest plants start with the lowest productivity growth at the initial time period, but they catch up older plants productivity, which present the highest average
growth rate through years. This may indicate a ‘learning-by-doing’ process for the industry.
No Reference information available - sign in for access.
No Citation information available - sign in for access.
No Supplementary Data.
No Article Media
Document Type: Research Article
John F. Donahue Graduate School of Business, Duquesne University, 600 Forbes AvenuePittsburghPA 15282, USA
Department of Agricultural Economics,Pennsylvania State University, University ParkPA 16802, USA
Publication date: 2011-09-01
More about this publication?