Productivity and Efficiency Analysis Seminar Series
Path Approach to the Decomposition of Productivity Indexes
Date: 18 May 2026
Time: 9:30 AM –11:00 AM (UTC+8)
Venue (TencentMeeting): 218-207-143
Speaker: ZHAO Long (Hunan University)
Abstract: The Malmquist productivity index has been widely utilized to quantify productivity changes over time, and various decompositions have been proposed to capture different aspects of these changes. However, as different components are introduced, solutions are not guaranteed under variable returns to scale (VRS) and the practical interpretations of those components become ambiguous. To resolve these issues, this paper proposes a path approach to decompose the Malmquist productivity index by identifying productivity change between input‑output vectors along a sequential path with all components computed against a constant returns to scale (CRS) frontier. The path‑dependent decomposition ensures feasible solutions, with each component unambiguously reflecting a distinct productivity change and enabling comparisons between points on the “true” frontiers. By eliminating interpretive ambiguities and ensuring computability, our approach strengthens the practical relevance of the Malmquist productivity index and offers policymakers actionable insights for productivity improvement.
Keywords: Malmquist productivity index; Path‑dependent decomposition; Constant returns to scale; Variable returns to scale
Authors: ZHAO Long (Hunan University); LI Sung Ko (Hong Kong Shue Yan University and Hong Kong Baptist 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