Assessing the Performance of Canada's Manufacturers

This thesis uses data collected from a sample of thirty-nine Canadian and thirty-nine American manufacturing firms to provide an empirical foundation for the assessment of the performance of Canadian manufacturers through most of the twentieth century. The unbalanced panel of Canadian firms covers the years 1907-1990. The unbalanced panel of American firms covers the years 1902-1990. To quantify the performance of Canadian manufacturers I measure relative technical efficiency by calculating the total factor productivity (T.F.P.) and labour, capital and intermediate input partial factor productivities of the Canadian firms in my sample relative to the American firms. On average I find that the Canadian firms have had lower labour productivity and intermediate input productivities, but superior capital productivity. When measuring the productivity of the entire production process simultaneously there appears to have been no consistent and substantial T.F.P. difference between the Canadian and American firms, on average. To explain the variation in the partial factor productivities between my Canadian and American firms I disaggregate the total variation into differences due to domestically unique input prices, output levels, biased technology and neutral technology. In general the Canadian firms appear to have been responding to lower labour and intermediate input prices and higher capital costs by using the relatively expensive inputs conservatively and the relatively inexpensive inputs liberally. The Canadian firms also appear to have been adapting their technology in response to the unique input market conditions they faced. The evidence that the Canadian firms in my sample were choosing input combinations and technology which reflected the domestic input prices they faced indicates behaviour consistent with competent entrepreneur ship. Additional evidence illustrating the Canadian producers' responsiveness to idiosyncratic and continental changes in their input market conditions reinforces the partial factor productivity evidence: The performance of the Canadian manufacturers' in my sample of firms, with respect to total factor productivity and responsiveness to domestic input market conditions, suggests that on average Canadian manufacturers have traditionally performed at least as well as their American counterparts

Business · Efficiency Analysis Using DEA · Firm Innovation and Growth · Global trade and economics

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