Wg. Waters et Mw. Tretheway, Comparing total factor productivity and price performance - Concepts and application to Canadian railways, J TRANSP EC, 33, 1999, pp. 209-220
Productivity is normally measured by output-input comparisons, either with
index numbers or as a shift in an econometric cost (or production) function
. Productivity enables output price increases to be less than the increases
in input prices. The link between productivity, prices and profitability h
as been recognised in the management literature, but little attention has b
een paid to it in the economics literature. In this paper the links between
productivity and price performance are examined using data derived from in
dex-number studies and illustrated for Canadian railways 1956-95.