What Drives the Productive Efficiency of a Firm?: The Importance of Industry, Location, R&D, and Size

Table 1: Estimation results of the logarithmic Translog production function
with fixed effects, years 1992-2005

Variable	Coefficient	p-value
βmat	0.2Ô9	<.0001
βlab	0.229	<.0001
βene	0.028	0.0016
βcap	0.245	<.0001
βoth	0.167	<.0001
βext	0.116	<.0001
^β2 mat	0.055	<.0001
в2_lab	0.073	<.0001
^β2 ene	0.007	<.0001
^в2_cap	0.027	<.0001
^в2_oth	0.026	<.0001
^в2_ext	0.016	<.0001
^γmat_ lab	-0.057	<.0001
^γmat_ ene	-0.001	0.2093
^γmat_ cap	-0.02	<.0001
^γmat_ oth	-0.008	<.0001
^γmat_ ext	-0.017	<.0001
^γlab_ene	-0.009	<.0001
^γlab_cap	-0.033	<.0001
^γlab_oth	-0.036	<.0001
^γlab_ext	-0.012	<.0001
^γene_cap	0.003	0.0016
^γene _oth	-0.003	<.0001
^γene _ext	-0.001	0.0002
γca p_oth	-0.009	<.0001
^Ycap_ext	-0.001	0.0191
^γoth _ext	0.001	0.1135
D1992	0.022	<.0001
D1993	0.009	<.0001
D1994	0.012	<.0001
^D1995	0.017	<.0001
^D1996	0.011	<.0001
D1997	0.015	<.0001
D1998	0.013	<.0001
D1999	0.017	<.0001
D2000	0.014	<.0001
D2001	0.006	<.0001
D2002	-0.004	0.0146
D2003	-0.002	0.0711
_____________D2004_________	___________0.003	0.0236
R2		0.995
Number of observations		217,415

Notes: mat: material inputs, lab: labor compensation, ene: energy consumption, cap:
capital, oth: other inputs, ext: external services.

hypothesis β₂_i = 0 and γ_ij = 0 for all i and j. This null hypothesis is strongly rejected (p-
value < 0.0001) indicating that the translog specification is more appropriate. Second, the H0
that (∑β2_-_i + ∑γ_ij) (j'=i) is equal to zero¹³ is not rejected (p-value = 0.41). This indicates a
¹³This sum of estimates is 0.000474, with a standard error of 0.000572.

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