Stochastic production frontier model to estimate the contribution of technological progress to TFP change: The findings from enterprises’ data

Abstract

This study aims to quantify the contribution of technological progress to economic growth by the parametric technique, using stochastic production frontier models. The stochastic production frontier model is applied for panel data of enterprises belonging to 82 kinds of economic activities at 3 sectors (agriculture, forestry, and fishing; industry and construction; and services) for the period of 2010 to 2014. The result of estimation shows that technological progress increased 0.758% per year and contributed 50.7% to TFP change in this stage.