Working Paper No. 02-12

Korean and Taiwanese Productivity Performance -- Comparisons at Matched Manufacturing Levels
Frank S.T. Hsiao and Changsuh Park
October 2002

ABSTRACT

We compare productivity performances of the world's two most rapidly growing countries using matched manufacturing sectors by finding the Malmquist productivity index and its four components, aided by visual methods and correlation analysis. The distance functions are estimated by using category-wise cross-industry meta frontiers from 1979 to 1996. We find that the overall productivity and technology growth rates of Korea are lower than those of Taiwan, explaining postwar Korea's per capita GDP being less than that of Taiwan. At disaggregated levels, in general, the productivity index is positively and significantly correlated with the technology index, and negatively and insignificantly correlated with the efficiency index. Technology appears to be independent of efficiency in these two countries.

JEL classification: -.
Keywords: productivity analysis, Malmquist Indexes, Korea and Taiwan, economic growth.

DOWNLOAD PAPER