Is there a case for low inflation-induced productivity growth in selected Asian economies?

The authors examine the evidence on the relationship between inflation and productivity growth for nine Asian economies using causality analysis in a multivariate model with money supply as a possible effective monetary policy tool. The inflation-productivity growth relationship is found to be non-uniform, as the evidence of uni-directional, bi-directional, and no causality between the two variables is varied and significant for some countries and insignificant for others. An attempt is made to explain the inflation-productivity nexus for these countries and to discuss implications for anti-inflationary policies such as inflation targeting.

The productivity-inflation nexus: The case of the Australian mining sector

This paper examines the causal links between productivity growth and two price series given by domestic inflation and the price of mineral products in Australia's mining sector for the period 1968/1969 to 1997/1998. The study also uses a stochastic translog cost frontier to generate improved estimates of total factor productivity (TFP) growth. The results indicate negative unidirectional causality running from both price series to mining productivity growth. Regression analysis further shows that domestic inflation has a small but adverse effect on mining productivity growth, thus providing some empirical support for Australia's 'inflation first' monetary policy, at least with respect to the mining sector. Inflation in mineral price, on the other hand, has a greater negative effect on mining productivity growth via mineral export growth.

Adaptive economic growth

This paper develops an evolutionary theory of adaptive growth, understood as a product of structural change and economic self-transformation, based upon processes that are closely connected with but not reducible to the growth of knowledge. The dominant connecting theme is enterprise, the innovative variations it generates and the multiple connections between investment, innovation, demand and structural transformation in the market process. The paper explores the dependence of macroeconomic productivity growth on the diversity of technical progress functions and income elasticities of demand at the industry level, and the resolution of this diversity into patterns of economic change through market processes. It is shown how industry growth rates are constrained by higher-order processes of emergence that convert an ensemble of industry growth rates into an aggregate rate of growth. The growth of productivity, output and employment are determined mutually and endogenously, and their values depend on the variation in the primary causal influences in the system.

How cost efficient are Australia's mining industries?

This paper uses a stochastic translog cost frontier model and a panel data of five key mining industries in Australia over 1968-1969 to 1994-1995 to investigate the sources of output growth and the effects of cost inefficiency on total factor productivity (TFP) growth. The results indicate that mining output growth was largely input-driven rather than productivity-driven. Although there were some gains from technological progress and economics of scale in production, cost inefficiency which barely exceeded 1.1% since the mid-1970s in the mining industries was the main factor causing low TFP growth. (C) 2002 Elsevier Science B.V. All rights reserved.

A Bayesian approach to imposing curvature on distance functions

The estimated parameters of output distance functions frequently violate the monotonicity, quasi-convexity and convexity constraints implied by economic theory, leading to estimated elasticities and shadow prices that are incorrectly signed, and ultimately to perverse conclusions concerning the effects of input and output changes on productivity growth and relative efficiency levels. We show how a Bayesian approach can be used to impose these constraints on the parameters of a translog output distance function. Implementing the approach involves the use of a Gibbs sampler with data augmentation. A Metropolis-Hastings algorithm is also used within the Gibbs to simulate observations from truncated pdfs. Our methods are developed for the case where panel data is available and technical inefficiency effects are assumed to be time-invariant. Two models-a fixed effects model and a random effects model-are developed and applied to panel data on 17 European railways. We observe significant changes in estimated elasticities and shadow price ratios when regularity restrictions are imposed. (c) 2004 Elsevier B.V. All rights reserved.

Effects of iron additions on filament growth and productivity of the cyanobacterium Lyngbya majuscula

The bioavailability of iron, in combination with essential macronutrients such as phosphorus, has been hypothesised to be linked to nuisance blooms of the toxic cyanobacterium Lyngbya majuscula. The present laboratory study used two biological assay techniques to test whether various concentrations of added iron (inorganic and organically chelated) enhanced L. majuscula filament growth and productivity (C-14-bicarbonate uptake rate). Organically chelated iron (FeEDTA) with adequate background concentrations of phosphorus and molybdenum caused the largest increases (up to 4.5 times the control) in L. majuscula productivity and filament growth. The addition of inorganic iron (without added phosphorus or molybdenum) also stimulated L. majuscula filament growth. However, overall the FeEDTA was substantially and significantly more effective in promoting L. majuscula growth than inorganic iron (FeCl3). The organic chelator (EDTA) alone and molybdenum alone also enhanced L. majuscula growth but to a lesser extent than the chelated iron. The results of the present laboratory study support the hypothesis that iron and chelating organic compounds may be important in promoting blooms of L. majuscula in coastal waters of Queensland, Australia.

Growth performance and management of a mixed rainforest tree plantation

Monoculture plantations of Pinus, Eucalyptus and Acacia have been established oil rainforest lands throughout the world. However, this type of reforestation generally supplies low quality timber and contributes to landscape simplification. Alternatives to exotic monoculture plantations are now beginning to gain momentum with farmers and landholders attempting to establish a variety of rainforest trees in small plantations. When compared to the well studied commercial species, knowledge concerning the growth and management of many of these rainforest species is in its infancy. To help expand this limited knowledge base an experimental plantation of 16 rainforest tree species in a randomised design was established near Mt. Mee, in south-eastern Queensland, Australia. Changes in growth, form (based on stem straightness, branch size and branchiness), crown diameters and leaf area of each species were examined over 5 years. Patterns of height growth were also measured monthly for 31 months. Species in this trial could be separated into three groups based on their overall growth after 5 years and their growth patterns. Early successional status, low timber density, high maximum photosynthetic rates and large total leaf areas were generally correlated to rapid height growth. Several species (including Araucaria cunninghamii, Elaeocarpus grandis, Flindersia brayleyana, Grevillea robusta and Khaya nyasica) had above average form and growth, while all species in the trial had considerable potential to have increased productivity through tree selection. As canopy closure occurred at the site between years four and five, growth increments declined. To reduce stand competition a number of different thinning techniques could be employed. However, simple geometric or productivity based thinnings appear to be inappropriate management techniques for this mixed species stand as they would either remove many of the best performing trees or nearly half the species in the trial. Alternatively, a form based thinning would maintain the site's diversity, increase the average form of the plantation and provide some productivity benefits.