Replication package for: "The Standard Total Factor Productivity Index and its decomposition"

This replication package contains the files required for replicating the results presented in the paper “The Standard Total Factor Productivity Index and its decomposition” co-authored by Juan Aparicio and Daniel Santín and accepted for publication by August 2025 in European Journal of Operational Research.
https://www.sciencedirect.com/science/article/pii/S0377221725006204

The package contains:
- The well-known database of 42 Swedish pharmacies between 1980 and 1989 previously analyzed in the seminal paper of Färe et al. (1992).
- R code to replicate the numerical example in Section 3.3 (Annex A).
- R code with the steps for doing the numerical analysis of Section 4 (Annex C).
- A README file basic instructions for running the R scripts and the definition of variables.

The Malmquist Productivity Index is widely used to measure and decompose productivity changes in multi-input, multi-output settings. This index is appealing mainly because it does not need information on market prices, which makes the index suitable for benchmarking public production units (as courts, schools, hospitals or universities).

However, existing approaches face a trade-off:
The Adjacent Malmquist index→ avoids a base period but fails circularity.
The Base-period Malmquist index → satisfies circularity but requires an arbitrary base period.

The new Total Factor Productivity Index (TFPI) is based on geometric grounds and introduces a parametrically defined Standard Reference Technology that is:
✔ Circular – to carry out robust multilateral comparisons of DMUs over time
✔ Base-period free – no arbitrary base technology choice needed. The new Standard develops this role.
✔ Versatile & adaptable – works for any multi-input, multi-output production process
✔ Can be decomposed - into efficiency change, global technical change and local technical change (see Aparicio and Santín, 2024)
✔ It is a true TFPI - to be expressed as the ratio of output to input quantity changes

References:
Aparicio, J., & Santín, D. (2024). Global and local technical changes: A new decomposition of the Malmquist productivity index using virtual units. Economic Modelling, 134, 106674.
Färe, R., Grosskopf, S., Lindgren, B., & Roos, P. (1992). Productivity changes in Swedish pharmacies 1980-1989: A non-parametric Malmquist approach. Journal of Productivity Analysis, 3(1), 85-101.