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Economic production analysis can provide critical perspectives on an industry’s performance. The purpose of this paper is to investigate the factor input intensity of hospitality and related industries, namely, accommodation, food service and amusement, gaming and recreation (AFAGR), compared to other service industries.

This paper compared AFAGR with other industries categorized as services by the North American Industry Classification System (NAICS). The NAICS code of up to four digits was used to collect data (US Census Bureau).

Results of this paper confirm extant literature that food service is more labor-intensive than other service industries; however, this was not true of accommodation and AGR industries. Similarly, while food service industry was relatively less intermediate input intensive than other service industries, accommodation and AGR were not. There were no significant differences between hospitality and other service industries (AFAGR) in their capital intensity. Another important finding was that while accommodation had constant results to scale, AGR had increasing returns to scale and food service industry was found to have decreasing returns to scale.

This investigation only looked at the four-digit NAICS-coded industries. International differences could also be investigated in the future.

Based on theoretical arguments, high labor intensity together with low intermediate input in food service industry suggests that efficiencies could be gained in these businesses. This may also be evident by the decreasing returns to scale that this paper found for the food service industry. These comparisons could guide additional research about the causes, consequences and potential sources of improvement of efficiency of economic productivity in AFAGR. Managers in AFAGR would find it valuable to understand how they might be able to enhance economic output, particularly in the context of the role of labor. Furthermore, any changes in one economic input would have implications on other inputs and possibly on productivity.

Any future recalibration of input intensity in hospitality industries could have both social and economic consequence.

This paper enhances our understanding of how hospitality industries use economic factors of production. Labor in AFAGR is viewed as a given. This study suggests that food service industry may need to reevaluate its labor productivity, the way it is measured and how it might affect efficiencies. Such understanding could better inform the sources and causes of economic efficiencies in AFAGR industries. Until now, this understanding has mostly been based on relatively scarce comparative systematic analysis.

In the process of industrial growth, when existing industries go for technology upgradation and new modernised industries emerge, both capital intensity and energy demand of overall industry tend to rise steadily. This poses a serious challenge for sustainable development objectives. Towards this end, enhancing energy efficiency of individual industries is the only remedy. Against this backdrop, the study aims to probe the trends in capital intensities and energy efficiencies of individual industries in India.

This study uses panel data regression analysis on data of two-digit industries from 1980/1981–2016/2017. The statistical analysis includes relevant macroeconomic variables derived from the literature to ascertain the drivers of energy efficiency in industries.

The results brought out that capital deepening due to technology upgradation and modernisation and capital productivity growth are the decisive determinants of energy efficiency growth. Furthermore, the ever-increasing fuel price motivated industries to conserve energy on a steady basis, supplemented by energy conservation-specific policy interventions.

This study recommends policy initiatives to ascertain and address technology gaps industry-wise, so that its subsequent efficient capital utilisation, and energy conservation measures of industries would result in energy efficiency growth in industry. The policy must focus on energy-efficient capital intensification in fabricated metals, leather, textile and wood industries that are found less-energy-efficient despite being less-capital-intensive.

This study empirically explores the capital efficiency of industries by investigating the interaction between capital intensity and energy efficiency at a two-digit industry level. It explores the determinants of energy efficiency and proposes industry-specific policies for energy-efficiency-enhancement of the overall industry.

The purpose of this study is to analyze the potential existence of a concave downward curve between organizational commitment to employees (OCE) and labor productivity in small firms. It also aims to examine the moderating effects of labor intensity on this curvilinear relationship.

The paper uses a sample of 819 manufacturing small firms from the Spanish Ministry of Industry and Energy's Survey on Business Strategies, and applies hierarchical regression analysis to test its hypotheses.

The results support a non‐linear association between OCE investments and labor productivity: the higher the level of OCE, the lower its positive impact on organizational outcomes will be. The results also support the contingent view of strategic human resource management, so that an investment in OCE is more effective in some contexts than in others.

The paper concludes that managers and investors should be aware of the fact that investments in OCE are not always correspondingly beneficial. In the small firm setting, not all firms with large profits apply OCE. A high level of OCE investment may be counterproductive.

The strategic human resource management literature usually assumes a linear relationship between OCE and organizational outcomes; very few empirical studies have considered a nonlinear approach.

How do energy consumption, efficiency and economic performance vary between small enterprises belonging to two different product clusters whose production process and technologies differ?

The objectives are analyzed based on empirical data gathered from a field survey of small enterprises with reference to auto ancillaries in Shimoga and brick‐making enterprises in Malur of Karnataka State in India. Simple averages, correlation and multiple‐regression techniques are used for the analysis.

The study brought out that higher energy intensity results in higher share of energy cost in total variable cost. Energy intensity had a negative relationship with value of output. Energy makes a statistically significant contribution to returns to scale. The classification of small enterprises into two groups based on above average energy intensity and below average energy intensity, and the subsequent regression analysis brought out that energy intensity had a positive influence on returns to scale in auto ancillaries whereas a negative influence on returns to scale in bricks enterprises.

The sample‐size formulation could not be done on a scientific basis due to the absence of comprehensive data on all small enterprises operating in the respective clusters and therefore, the findings may not be generalized.

Industry specific characteristics must be taken into account while introducing “energy efficiency improvement” programmes as a means of enhancing competitiveness in “energy intensive” small enterprises.

The paper illustrates the scope for energy conservation and efficiency improvement in Indian small enterprises.

This paper aims to make an attempt to identify labour intensity of organized manufacturing industries in India using the Annual Survey of Industry (ASI) data at three-digit level. It estimates total factor productivity growth (TFPG) and technical efficiency for both labour intensive and all manufacturing industries during the pre- and post-reforms periods.

The study uses three approaches to estimate TFPG. They are growth accounting (GA) (non-parametric), production function with correction for endogeneity – Levinsohn-Petrin (LP) (semi-parametric) and stochastic production frontier (SPF) analysis (parametric). The study uses ASI data published by Central Statistical Organization, Government of India for the period 1980-1981 to 2007-2008 for the analysis.

The study finds that the rate of decline of the labour intensity is more pronounced in the case of labour-intensive industries than all the manufacturing industries. The results of GA method suggest that the TFPG of labour-intensive industries has declined continuously from the pre-reforms period to the post-reforms period. Similarly, LP method indicates a continuous decline in TFPG of labour-intensive manufacturing industries during the post-reforms period. Interestingly, the results of SPF method also corroborate the findings of earlier two methods at the aggregate level but vary at a certain degree at the disaggregated level.

This paper is useful in the context of India considering the importance given to labour-intensive industries by the present government in terms of reviving the sector and improving the productivity and output.

Purpose – This chapter analyzes the effects that the international integration of product markets induced by globalization exerts on the direction of technological change at the industry level.

Methodology/approach – In order to do so it elaborates an interpretative framework that complements the classical inducement hypotheses with the Schumpeterian literature and the localized technological change approach, putting forward the hypothesis that technological change is biased by the dynamics of both factor and product markets. We argue and show that not only the changing levels of input costs but also the changing prevalence of product and process innovations affect the direction of technological change: specifically when product innovations prevail technological change is skill-biased, while when process innovations play a major role innovation is capital intensive.

Findings – Following this perspective we analyze the interindustrial variance of the output elasticities of labor of the main advanced economies in recent years and claim that such heterogeneity can be understood as the result of differentiated innovative reactions of firms to changes induced by the globalization of the markets: fast-growing sectors innovate mainly through (skilled) labor-augmenting technological change, while mature industries rely more on capital-enhancing innovations. The empirical evidence supports our hypotheses and shows that the variance of the output elasticity of labor in a panel data estimate across 17 manufacturing sectors in 16 OECD countries from 1995 to 2006, is significantly and positively associated with the rates of growth of employment, wage levels and their rates of increase, and R&D intensity.

Originality/value of paper – By investigating the variance of output elasticities at the industry level the chapter provides new insights within the literature focused on the bias of technological change.

Economic theories on structural change focus on factors such as fluctuations in relative prices and income growth. In addition, China’s reform and opening up has also been accompanied by increasing openness, significant fluctuations in investment rates, and frictions in the labor market. Existing literature lacks a unified theoretical framework to assess the relative importance of all these determinants. The paper aims to discuss these issues.

To incorporate all of the potential determinants of China’s structural change, the authors build a two-country four-sector neoclassical growth model that embeds the multi-sector Eaton and Kortum (2002) model of international trade, complete input-output structure, non-homothetic preference and labor market frictions. The authors decompose the sectoral employment shares into six effects: the Baumol, Engel, investment, international trade, factor intensity and labor market friction effects. Using the data of Chinese economy from 1978 to 2011, the authors perform a quantitative investigation of the six determinants’ effects through the decomposition approach and counterfactual exercises.

Low-income elasticity of demand, high labor intensity, and the existence of the switching costs are the reasons for the high employment share in the agricultural sector. Technological progress, investment and international trade have comparatively less influence on the proportion difference of employment in the three sectors.

Therefore, to examine the impact on China’s structural change, in addition to Baumol effect and the Engel effect, it is also necessary to consider the impact of three more factors: international trade, investment and switching costs. Therefore, the authors decompose the factors that may influence China’s structural change into the Baumol, Engel, investment, international trade, factor intensity effect and switching cost effects. The authors evaluate these six effects using the decomposition approach and counterfactual exercises.

The Korean manufacturing sector has undergone structural changes in a transition from labor- to capital-intensive industries. These changes seem to be relevant to the weakening of the export effect on employment that began in 1990. In light of the importance of exports in the Korean labor market, the purpose of this paper is to shed light on the primary reasons why export growth does not lead to sufficient job creation as it did in the past.

The authors first use the growth accounting approach to show that the weakening of the linkage between exports and employment is closely related to the composition of export products, which has changed toward being more labor-saving. An empirical analysis (i.e. first difference A-B generalized method of moments estimator) on the employment effect of exports confirms that as the capital-intensity of exports increases employment effect decreases.

The main findings of the study can be summarized as follows. First, the reduction in the export effect on exports is highly correlated with changes in the composition of export products. Second, an increase in exports leads to an increase in manufacturing jobs, and the export elasticity of employment decreases as capital-intensity increases. Third, the export elasticity of employment tends to be higher when the export proportion of SMEs’ products is larger.

Despite the many literatures on the link between exports and employment, there is no consensus on this topic. However, it is generally agreed that the employment effect of exports has been considerably weakened, compared to that of the past, at least in Korea. Nevertheless, few studies attempt to address why this trend has occurred. In this paper, we focus on the structural factors that are the major cause of the weakening of the virtuous cycle between exports and employment. This allows us to provide valuable information to policy makers who are concerned with developing export policies that are related to effective job creation.

Because of growing energy consumption and increasing absolute CO₂ emissions, the recent calibrations about the environmental sustainability across the globe have mandated to achieve the minimal energy consumption through employing energy-efficient technology. This study aims to estimate linkage between simple measure of energy efficiency indicator that is reciprocal of energy intensity and total factor productivity (TFP) in case of Indian paper industry for 21 major states. In addition, the study incorporates the other control variables like labour productivity, capital utilization and structure of paper industry to scrutinize their likely impact on energy efficiency performance of the industry.

To derive the plausible estimates of TFP, the study applies the much celebrated Levinsohn and Petrin (2003) methodology. Using the regional level data for the period 2001-2013, the study employs instrumental variable-generalized method of moments (GMM-IV) technique to examine the nature of relationship among the variables involved in the analysis.

An elementary examination of energy intensity shows that not all states are equally energy intensive. States like Goa, Rajasthan, Jharkhand and Tamil Nadu are less energy intensive, whereas Uttar Pradesh, Kerala, Chhattisgarh, Assam and Punjab are most energy-intensive states on the basis of their state averages over the whole study period. The results estimated through GMM-IV show that increasing level of TFP is associated with lower level of energy per unit of output. Along this better skills and capacity utilization are also found to have positive impact on energy efficiency performance of industry. However, the potential heterogeneity within the structure of industry itself is found responsible for its higher energy intensity.

States should ensure and undertake substantial investment projects in the research and development of energy-efficient technology and that targeted allocations could be reinforced for more fruitful results. Factors aiming at improving the labour productivity should be given extra emphasis together with capital deepening and widening, needed for energy conservation and environmental sustainability. Given the dependence of structure of paper industry on the multitude of factors like regional inequality, economic growth, industrial structure and the resource endowment together with the issues of fragmented sizes, poor infrastructure and availability and affordability of raw materials etc., states should actively promote the coordination and cooperation among themselves to reap the benefits of technological advancements through technological spill overs. In addition, owing to their respective state autonomies, state governments should set their own energy saving targets by taking into account the respective potentials and opportunities for the different industries. Despite the requirement of energy-efficient innovations, however, the cons of technological advancements and the legal frameworks on the employment structure and distributional status should be taken care of before their adoption and execution.

To the best of our knowledge, this is the first study that empirically examines the linkage between energy efficiency and TFP in case of Indian paper industry. The application of improved methods like Levinsohn and Petrin (2003) to derive the TFP measure and the use of GMM-IV to account for potential econometric problems like that of endogeneity will again add to the novelty of study.

Many manufacturing firms (e.g. Apple and Nike) now outsource some or all of their manufacturing activities to independent suppliers rather than continuing to undertake them in-house. Clearly these firms perceive this externalisation of production to be a performance-enhancing strategy, but what are the performance consequences in practice? In this chapter, we review and critique the extant academic literature on the performance consequences of manufacturing outsourcing, and note that the empirical findings have yielded mixed results. We argue that outsourcing has potential impacts upon a number of ‘performance’ outcomes, including inter alia financial performance, productivity/efficiency, sales/market share, costs of production, business performance and innovation. We further argue that many of the empirical studies have flawed designs, and make a series of methodological recommendations to guide future empirical work.