Measuring Total Factor Productivity with Fixed Effect, LP, and OP Methods

This study applies the fixed effect method, LP method, and OP method to assess total factor productivity (TFP) following the research of Lu and Lian (2012). TFP serves as a measure of input-output efficiency, replacing the explanatory variables in regression analysis. Capital, labor, investment, and intermediate input are selected as input indicators, while operating income is chosen as the output indicator.