How SMEs or larger firms and industries' productivity respond to technology: a panel data study

Elias Sanidas 한국유통과학회 2017 KODISA ICBE (International Conference on Business Vol.2017 No.-

This paper is an important and necessary extension of the recent study by Lim and Sanidas (2011) where it was rigorously shown that both types of technology positively affect firms and industries in South Korea. How is this technological impact differentiated between SMEs and larger firms? The present paper answers this question and provides policy recommendations accordingly. Following the same methodology as in the just mentioned study, we put emphasis on the role of technological innovations which consist of two components: technical innovations (TIs) and organizational innovations (OIs). We use firm based data and the econometric method of Fixed Effects(FE) to measure the relationship between OIs, TIs and productivity. In these regressions we included some standard control variables such as wage efficiency, educational level, and capital to labor ratio to accommodate for other important influences. Some industries such as electrical machinery, motor vehicles, and non-electrical machinery have become more efficient in terms of OIs and TIs and thus improved productivity considerably. The results indicate that in general the size of firms is rather neutral to the influence of technology and all other factors on productivity. Thus, overall SMEs as well as large firms behave similarly in terms of the established relationships in this paper. However some significant differences which are detected in this study still exist.

The Role of Foreign Exchange Rates in Sub-Saharan Countries: Empirical Comparison with Non-Euro OECD Countries Using Panel Data

Elias Sanidas,Fetene Bogale Hunegnaw 서울대학교 경제연구소 2017 Seoul journal of economics Vol.30 No.2

The effect of devaluations on economies is one of the most controversial macroeconomic policies in Sub-Saharan Africa (SSA), both theoretically and empirically. This study uses panel data from 1995-2013 for 17 SSA countries and 17 non-Euro OECD economies. The main conclusion is that exchange rates devaluations and revaluations are an effective policy instrument in improving trade balances and boosting real output in both regions. There are some similarities in the results between the two groups of nations but also many differences, which are indicated in detail in the text. For example, regarding the estimation of trade balances directly, the income effects (own GDP and foreign GDP) and the exchange rates effect seem to be more important in the case of SSA group than in the case of the OECD group. There are also some policy implications. Thus, governments in SSA nations are encouraged to further pursue both exchange rates and monetary or fiscal policies; and as they develop their industries, they may rely more and more on floating exchange rates.

Linear Production Function Based Modeling and Estimations of wages and profits in S. Korean economy: Consequential policies

Elias Sanidas 서울대학교 경제연구소 2021 Seoul journal of economics Vol.34 No.4

The introduction of productivity, either in the form of a function of labor productivity or a function of wages in a linear production function (LPF), opens numerous possibilities for the correct estimation of the main parameters of capital and labor prices, as well the capital and labor shares in the national economy. The LPF is also successfully combined with the Cobb–Douglas production function to confirm the estimations of these parameters. In addition, we provide evidence as to why the wage share in the economy has been declining. Several other relations are also generated, such as the constancy of the GDP to capital ratio. Moreover, some related policies are examined regarding wages and profits.

KOREAN AUGMENTED PRODUCTION FUNCTION: THE ROLE OF SERVICES AND OTHER FACTORS IN KOREA’S ECONOMIC GROWTH OF INDUSTRIES

Elias Sanidas,박혜리 중앙대학교 경제연구소 2011 Journal of Economic Development Vol.36 No.1

It is well known that economic growth and services have a positive association. In particular, the more developed an economy is, the higher the share of the services sector. While most research has focused on service output, this study also examines services as input. Recently, the need for taking services a separate input in the production function has come to the fore. Therefore, the OECD productivity manual generalizes the KLEM model to KLEMS (capital-labor-energy-materials-services) model by including the services as an input. We use KLEMS data in this study. In addition, we augmented the standard production function with other variables such as the inventory to sales ratio, R&D to sales ratio, education expenditure to sales ratio, and the debt to sales ratio. The findings are encouraging and lead us to formulate some important conclusions; for example, after the 1998 Financial Crisis, the Korean economy has increased in efficiency and this is partly due to an increased importance of services as both output and input.

Convergence towards the Revealed Comparative Advantage Neutral Point for East Asia: Similarities and Differences between the Three Countries

Elias Sanidas,Yousun Shin 서울대학교 경제연구소 2011 Seoul journal of economics Vol.24 No.1

The aim of this study is to use two main revealed comparative advantage (RCA) indices (Balassa's and the most recent "normalized" indices) and various quantitative techniques in order to systemically and rigorously draw some conclusions as to comparative advantage (CA) of the three East Asian countries. We use both HS 2-digit and 4-digit data to see how the three countries perform in RCA from 1995 to 2008. Overall, we find that there still exists a strict hierarchy in terms of CA in the three East Asian countries, although there is also a catching up process between them with a convergence towards a more competitive structure of RCA in exports. This mainly means that Japan and Korea are already in the process of converging towards the RCA neutral point (thus sectors that had RCA in 1995 get worse and sectors that did not have RCA in 1995 get better). However, China's position is still different from that of the other two countries (overall it might still be in the process of divergence).

Korean Augmented Production Function : The Role of Services and Other Factors in Korea’s Economic Growth of Industries

ELIAS SANIDAS;PARK, HYERI 경제연구소 2011 Journal of Economic Development Vol.36 No.1

It is well known that economic growth and services have a positive association. In particular, the more developed an economy is, the higher the share of the services sector. While most research has focused on service output, this study also examines services as input. Recently, the need for taking services a separate input in the production function has come to the fore. Therefore, the OECD productivity manual generalizes the KLEM model to KLEMS (capital-labor-energy-materials-services) model by including the services as an input. We use KLEMS data in this study. In addition, we augmented the standard production function with other variables such as the inventory to sales ratio, R&D to sales ratio, education expenditure to sales ratio, and the debt to sales ratio. The findings are encouraging and lead us to formulate some important conclusions; for example, after the 1998 Financial Crisis, the Korean economy has increased in efficiency and this is partly due to an increased importance of services as both output and input.

The Impact of Foreign Aid’s 7 Functional Categories on Economic Development in Recipient Countries

Kyunghee Min,Elias Sanidas 한국경제연구학회 2011 Korea and the World Economy Vol.12 No.1

There are 3 major views on the effectiveness of foreign aid. First, foreign aid is perceived as positive in terms of its effect on growth. Second, foreign aid is effective when certain conditions (e.g. political conditions) are satisfied. Third, aid has neither significant impact nor has it positive returns on economic growth. A substantial part of foreign aid research has been focused on total amount of aid‘s effects on economic growth. To clarify all these issues, 7 major functional types of aid are examined (e.g. social services and infrastructure). From the methodology perspective, we use panel data techniques such as the fixed effects, random effects and system GMM. For describing economic development, we use the proxies of ?PQLI (Physical Quality of Life Index),‘ HDI (Human Development Index), infant mortality rate, age dependency ratio, adult literacy rate, as well as GDP growth, and others. All these variables are used as dependent variables to judge aid‘s effectiveness. Concerning the independent variables, we use a variety of them as per literature and the 7 categories of aid. As a result of this analysis all categories of aid affect our dependent variables in different ways. Two important consequences can be drawn from our study. First, our paper confirms the positive impact of foreign aid on economic development as many other researchers have been pointed and contrary to those who have suggested a negative impact of foreign aid. And second, both recipient and donor countries can see the significance and impact of different categories of aid more precisely.