SECTORAL DYNAMICS AFTER 2008-2009 CRISIS IN BULGARIA: PANEL DATA ANALYSIS BY CLASSICAL PRODUCTION FUNCTION
Keywords:
production function, nonfinancial sectors dynamics, panel analysis, BulgariaAbstract
The paper presents selected results from an empirical analysis of the dynamics of nonfinancial sectors in Bulgaria for the period since the start of the global crisis in 2008-2009. This analysis utilizes sectoral data for key variables like revenues from main activity (sales of produced goods or services), number of employed, and annual size of the long-term assets resembling the aggregate fixed capital in the sectors. Annual data for the period 2008-2020 is used for the following 13 sectors: A- Agriculture, forestry and fishing; B- Mining and quarrying; C- Manufacturing; D- Electricity, gas, steam and air conditioning supply; E- Water supply, sewerage, waste management and remediation activities; F- Construction; G- Wholesale and retail trade; repair of motor vehicles and motorcycles; H- Transportation and storage; I- Accommodation and food service activities; J- Information and communication; L- Real estate activities; M- Professional, scientific and technical activities; N- Administrative and support service activities (excluded sectors: P- Education; Q- Human health and social work activities; R- Arts, entertainment and recreation; S- Other service activities). The methodology utilizes panel regression methods adapted for panel data analysis based on fixed effects models. Implementing a traditional panel data approach, classical models of production function are estimated after the necessary double-log transformation into linear equations. Additionally, a panel regression model is estimated using intensive variables e.g. the log-levels of the labour productivity and capital intensity. The paper reports a selection of major results from the empirical analyses conducted by classical production functions estimated by panel data for this particular selection of major nonfinancial business sectors. In large extent these results confirm the expectations about a significant impact of the major factors of production on the sectoral economic dynamics in Bulgaria for the studied period.
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