Phillip Hone

Economic openness and technical efficiency: A case study of Chinese manufacturing industries

This paper presents a study of the technical efficiency of industries in a transitional economy: China. Using data for 28 manufacturing industries across 29 provinces and the Data Envelopment Analysis approach, the technical efficiency of each industry is measured and compared across regions and provinces. The determinants of differential technical efficiency performance are analysed, with a particular focus on the impact of trade orientation and foreign investment. Trade openness is found generally to have a positive effect on technical efficiency.

The efficiency of the Australian dairy processing industry.

In this article we analyse trends in the economic performance of the dairy processing industry and evaluate the link between these trends and the deregulation of the industry. Using Stochastic Frontier Analysis to derive Malmquist total factor productivity estimates, we show that the industry exhibits a relatively high level of technical efficiency. Victoria, the major producing state, has been effectively on the frontier over the period studied. In recent years, the rapid expansion in capital investment that has attended the shift towards deregulation, has been accompanied by an apparent slowdown in both productivity growth and technical progress. There is also evidence of a convergence in productivity levels across states.

Discrimination, Performance and Career Progression in Australian Public Sector Labor Markets

While promotion is an important mechanism for allocating labor within organizations, relatively little is known about the determinants of promotion in the highly diverse and traditionally heavily regulated Australian labor markets. This study uses unique data from the Victorian Public Sector Census 2004 to identify the extent and nature of bias in the promotion process. Specifically, we use the promotion histories of 16,675 public sector employees to investigate the existence of discrimination in promotion on the basis of gender, disability and cultural diversity. We find that some differences exist in the rate of promotion on the basis of gender, and to a lesser extent, of birthplace, but, importantly, most of these are due to differences in endowments. There are effectively no differences in promotion on the basis of disability. We find that the main driver of promotion in Victorian public sector labor markets is worker effort and performance. Compared to labor markets elsewhere, the Australian public sector is relatively free of discrimination in promotions.

Spatial Pricing Efficiency in Fiji's Municipal Food Markets

The Fiji Islands economy is widely held to be constrained by a lack of market and transport infrastructure. Such infrastructure problems can reduce the efficiency of markets and result in wider than optimal disparities in food prices, both between markets and over time. In this paper we use monthly price data for 22 locally produced crops from Fijis major municipal markets, for the period 2001-2006, to identify the extent of the spatial pricing efficiency between these markets. Short-run price responses are estimated through SURECM. Relative price movements between markets indicate the potential for profitable arbitrage which will maximise the economic value of food to the Fijian economy. The arbitrageurs might be middlemen or individual farmers shifting their own produce between selling centres. We find that the municipal markets are generally spatially price efficient in the technical sense that prices return to their long-run relationships after a shock. But after a disturbance prices generally still take some two months to return to their equilibrium with the reference market, the capital Suva. This suggests there is scope for policy action to improve the spatial pricing efficiency of Fijis food markets. An enhanced market price reporting system is one option that deserves consideration.

Government Subsidies for Private Community Services: The Case of School Education

Governments confront potentially competing demands for increased provision of community services, prudent budgetary management and no expansion in taxes. In the areas of primary and secondary education, the federal government has attempted to deal with these pressures by using government subsidies for private schools to expand the size of the private school system and free up more resources for those who remain in the public education system. This initiative will be most successful when the demand for private education is highly responsive to private school fees and the subsidies are targeted at those segments of the school and student population that are most responsive to reductions in private school fees. The current system based on the overall Socio- Economic Status of each schools student population is probably an improvement over previous schemes, but it is still potentially inefficient because it does not target funds at the most fee-responsive groups.

Market Power and Contestability in Factor Markets: The Case of Tomato Pricing

Industry analysts, such as the Industry Commission (1991), have generally argued against government intervention to deal with market power in factor markets when the markets involved are highly contestable. In this paper it is shown that, under some conditions, the combination of a high degree of market concentration and contestability may create efficiency problems. The critical conditions are when industry output is small relative to the minimum efficient scale of the operations of the factor consumers and the marginal value products of the factor consumers are not constant over substantial ranges of input use. The potential policy implications of this set of circumstances are examined in the context of the Victorian tomato processing industry.

Assessing The Private Costs Of Soil Degradation**This paper is drawn from a wider study which was supported by the Wool Research and Development Corporation. Helpful comments from two anonymous referees are gratefully acknowledged.

While there is widespread concern in the Australian community with the extent of soil degradation, there is a paucity of reliable information on the extent of the costs that this degradation is imposing on Australia. A simple conceptual model of the private costs of soil degradation is outlined. On the basis of this model conventional measures of private soil degradation costs, such as the value of lost soil or production, the cost of repair and the opportunity cost of soil, are shown to have properties which make them unreliable indicators of the true costs involved. Given the difficulties in obtaining data on which to base reliable cost estimates it is suggested that the refinement of measures of soil scarcity has the potential to improve the efficacy of public policy decisions in this important area.