A Study of Productivity Changes in Food Retailing

Based on a general production function, this study estimates productivity gains and losses for the various outputs of food retailing over the period 1959 to 1979. Because it allows for the incorporation of all factors of production rather than just labor, the methodology employed in this study is superior to conventional methods of studying productivity change. Our estimates indicate that, between 1959–1979, total factor productivity in food retailing rose at a slower rate than total factor productivity in manufacturing. While total factor productivity in food retailing rose from 1959 until about 1972, it remained constant or declined between 1972–1979. We discuss the policy and managerial implications of our results, and provide suggestions for further research.