Productivity and Efficiency Analysis Seminar Series
A Theory of Technology-Based Productivity Index
Date: 16 March 2026 (Mon)
Time: 9:30 AM – 11:00 AM (UTC+8)
Venue (Zoom): https://hksyu.zoom.us/j/94727009492?pwd=0biEyqa1GwB7bDghyxFaXGG5rURbJw.1
Speaker: Prof. LI Sung Ko (Hong Kong Shue Yan University and Hong Kong Baptist University)
Abstract: There are several unsolved problems with the measurement of productivity. For example, to compute the value of a productivity index for any arbitrary production technology, many researchers assume constant returns to scale in their empirical technology. If this is true, why can a wrong assumption capture the characteristics of a “true” technology. To provide answers, we point out that the value of productivity depends on the production technology. This paper establishes a theoretical framework for technology-based productivity index. First, we show that, under a set of fundamental axioms, a unique ranking system of productivity exists, and it is a total preordering. Second, an iso-productivity surface is found, which can be treated as a measurement standard of productivity. Third, there exists a productivity level for each input-output vector. Such levels are consistent with the ranking system of productivity. Fourth, a productivity index can be constructed, and such index can measure productivity changes correctly. Applying our new theory to analyze some current productivity indexes in literature, we show that the input-oriented and output-oriented Malmquist productivity indexes assuming constant returns to scale are able to capture correct productivity changes. Finally, we provide arguments to support that, when production technology changes over time, the geometric mean formula is preferred to other choices in literature.
Keywords: technology-based productivity index, productivity kernel, total pre-ordering
Authors: LI Sung Ko (Hong Kong Shue Yan University and Hong Kong Baptist University); ZHAO Long (Hunan University)
Co-organized by:
Business, Economic and Public Policy Research Centre, Department of Economics and Finance, Hong Kong Shue Yan University
School of Business, Guangxi University
School of Economics and Trade, Hunan University
International College, Guangzhou College of Commerce