Radar scanning the world production frontier
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In this paper we report the results from a detailed investigation of the shifts of the world production frontier function over the period 1980–2010. Analogous to a radar we implement a novel measurement approach for these shifts using nonparametrically computed directional distance functions to scan the frontier shifts across the entire input–output space. The shifts of the frontier function measured in this way are analyzed by regression methods. The results point towards substantial non-neutrality of technological progress and furthermore show that technological progress is more pronounced in regions of high output and in regions where human capital is intensely used.
KeywordsNon-neutral technological change World production frontier Nonparametric frontier function
JEL ClassificationC14 E23 O11 O47
I am grateful to the participants of the 15th International Schumpeter Conference 2014 in Jena for their suggestions. Benny Hampf also provided many insightful comments. In the previous version of the paper I used generalized additive models for estimating the response surfaces. Simon Wood provided generous advice on these models which is gratefully acknowledged. I am also grateful to the inspiring comments of three anonymous referees which triggered a complete reconsideration of the approach and substantially improved the paper. Of course, all errors are mine.
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