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Journal of Economic Interaction and Coordination

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06-10-2017 | Regular Article

A note on the relationship between the total factor productivity and the network of firms

Authors: Antonio Palestrini, Enrico Guzzini

Published in: Journal of Economic Interaction and Coordination | Issue 2/2019

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Abstract

In this paper we study the robustness of the results found recently by Guzzini and Palestrini (J Econ Interact Coord 11:35–55, 2016). Since the original analysis was carried out in a static setting, we perform a dynamic panel analysis by using the same dataset. The inclusion of the lagged value of the endogenous variable, missing in the original paper, could be justified for several reasons. Firstly, the statistical relationship may have itself a dynamical nature; secondly the inclusion of lagged-endogenous variable is a way to mitigate the possibility of an omitted variable problem. We find that the results are only qualitatively the same, and we discuss the quantitative differences.

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The Unicredit-Capitalia survey has been used extensively by scholars to analyze Italian firms’ behavior and performance (see among others Bianco and Nicodano 2006; Angelini and Generale 2008; Guzzini and Iacobucci 2014a, b).

We use the Arellano and Bond (1991) difference GMM estimator. In particular, we use as instruments the dependent variable with lags 2 and 3 and the set of the exogenous variables.

This estimation is validated by the three standard tests. As the reader can see from Table 1, the AR(1) test is rejected while the AR(2) is not (in accordance with the dynamic panel theory). At the end, the Hansen test for the instruments’ exogenenity is not rejected suggesting that the instruments as a group are exogenous.

Also our analysis is conducted by using robust standard errors to cope with the problem of heteroskedasticity.

The average values of LIA are about 0.7 and the standard deviations are about 0.12. For details see Guzzini and Palestrini (2016, Table 3).

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Title: A note on the relationship between the total factor productivity and the network of firms
Authors: Antonio Palestrini
Enrico Guzzini
Publication date: 06-10-2017
Publisher: Springer Berlin Heidelberg
Published in: Journal of Economic Interaction and Coordination / Issue 2/2019
Print ISSN: 1860-711X
Electronic ISSN: 1860-7128
DOI: https://doi.org/10.1007/s11403-017-0203-6

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