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The role of inefficiency in a productivity puzzle: regional evidence for Great Britain

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journal contribution
posted on 2024-04-18, 11:17 authored by Anthony Glass, Karligash GlassKarligash Glass

From around the 2008 crisis there has been a marked slowdown in UK productivity. This has been referred to as a productivity puzzle as there is no consensus on the key explanations for this slowdown. Using data for all the 168 International Territorial Level 3 areas in Great Britain (2004–2020), we make two empirical contributions to the literature on this puzzle. First, we are the first to analyze this productivity puzzle using a stochastic frontier model to account for technical inefficiency. Second, to aid policymakers we uncover the areas that represent spatial total factor productivity (TFP) growth hubs, spokes, leaders and followers. Of the components of TFP growth (growth rates of technical change, returns to scale and efficiency), we find that Britain's productivity slowdown can be more specifically described as a rise in inefficiency.

History

School

  • Loughborough Business School

Published in

Journal of Regional Science

Publisher

Wiley Periodicals LLC

Version

  • VoR (Version of Record)

Rights holder

© The Authors

Publisher statement

This is an open access article under the terms of the Creative Commons Attribution (https://creativecommons.org/licenses/by/4.0/) License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

Acceptance date

2024-03-24

Publication date

2024-04-17

Copyright date

2024

ISSN

0022-4146

eISSN

1467-9787

Language

  • en

Depositor

Prof Karligash Glass. Deposit date: 27 March 2024