Biased Technical Change and the Malmquist Productivity Index

The Malmquist productivity index has many attractive features. One is that it can be epxressed as the product of a technical efficiency change index and a technical change index. In this paper we express the technical change index as the product of a magnitude index and a bias index. We then express the bias index as the product of an output bias index and an input bias index, and we state conditions under which each bias index makes no contribution to productivity change. * This paper is a merged revision of "Malmquist Productivity Indexes and Biased Technical Change" by Färe and Grosskopf and "A New Decomposition of the Malmquist Productivity Index" by Grifell and Lovell. We are indebted to the Editor and the referees for their guidance in preparing this revision. Grifell acknowledges financial support from CIRIT, Generalitat de Catalunya and Ministerio de Educaciön y Ciencia, DGICYT PB94-0708.