Productivity, Innovation and Growth in Sri Lanka : An Empirical Investigation
This study investigates the impact of key business environment indicators on productivity, innovation, and growth in Sri Lanka through a cluster-level productivity analysis, a firm-level total factor productivity analysis, and a firm-level innovati...
| Main Authors: | , |
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2013
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2013/02/17211806/productivity-innovation-growth-sri-lanka-empirical-investigation http://hdl.handle.net/10986/13155 |
| Summary: | This study investigates the impact of
key business environment indicators on productivity,
innovation, and growth in Sri Lanka through a cluster-level
productivity analysis, a firm-level total factor
productivity analysis, and a firm-level innovation analysis.
For the cluster-level productivity analysis (as measured by
output and value added per worker), it combines two
established data sources in a novel way by importing average
'industry-size-location' cluster-level business
environment variables from the World Bank Enterprise Survey
to the comprehensive Sri Lanka Census of Industry
productivity data available for similar clusters of
enterprises. For the firm-level total factor productivity
analysis, it compares data from the 2011 World Bank
Enterprise Survey with those from 2004. For the firm-level
innovation analysis, it compares findings from the 2011
World Bank Enterprise Survey with a representative sample of
enterprises collected as part of the Sri Lanka Longitudinal
Survey of Enterprises. The empirical findings highlight the
importance -- for cluster-level productivity, firm-level
total factor productivity, and innovation -- of connectivity
to global knowledge (reflected by one or more of export
participation, directly imported inputs, foreign ownership,
and use of the internet), availability of skills, access to
finance, and competition. The paper also presents evidence,
under the assumption that the samples are statistically
representative, that both allocative and average technical
efficiency have improved, with allocative efficiency
increasing roughly four-fold between 2003 and 2010, and
accounting for the overwhelming share of the aggregate
increase in total factor productivity over this time period.
Most of the improvement in allocative efficiency has
occurred among larger firms, and in large rather than small cities. |
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