Dear Muhamad,  This is a question that has been troubling economists for years.  never mind the semantics of the English and I focus on a production function or non parametric approach.  You need to be specific and clear about what and how you're measuring things.  Now assuming some kind of neo-classical production function TFP approach a la Jorgenson et al, or alternatively a torquist index approximation of same, then TFP is a residual that could contain (changes in the growth rate index approach): economies of scale, economies of scope, reorganisation of economic activity among the many actors/producers (See Gollop, Ball, Hawke and Swinand) (this may be a deviation from perfect comp), changes in input quality not captured in your current input quantity measurement programme, X-efficiency/inefficiency-non maximising producer behaviour (this is part of technical efficiency), slow adaption of new technologies (technical progress -- this may be optimal based on optimal replacement rates of long lived capital equipment - see the many articles by Jorgenson, etc).  If you're specifying a functional form then there are potential issues there too.  In anycase, if any of the factors such as scale etc, overwhelm the technical progress and technical efficiency, then one could be negative while the others positive.

BTW, I would not call better crop varieties technical efficiency, I would call these technological progress, and adopting best practices as technical efficiency (see Coelli at al textbook).  this is mostly just nomenclature.

To disentangle these, you need a methodology such as those developed by Fare et al.  or a translog distance function if going parametrical estimation route.

Dear Muhamad, I agree with what Gregory says. Just to add: Total factor productivity in macroeconomic growth models stays as a multiplier in production function and counts for the rest apart from labor and capital. However, natural factors (like land productivity, water availability that are very important for agriculture) are typically not considered. Negative shock in them can decrease the output even if nothing bad happens with labor, capital and innovations. Formally this will be a drop in TFP, but in reality it is mis-specification of a standard model.

Returning to your question, technological progress is related to R&D that results in inventions. However, not all inventions are implemented immediately and for some time production can be not updated to technologically efficient level.

Hi Gregory,

could you please extend your statement as follows:

"In anycase, if any of the factors such as scale etc, overwhelm the technical progress and technical efficiency, then one could be negative while the others positive".

How do a scale factor can negatively affect TP or TE ?

What is the pure technological progress and pure technical efficiency ?

Is technological change similar to technological progress?

The TPF is the part of the economic growth which is not explained by the increase of the volume of factors (capital and Labour); TPF measure the efficiency of the productive combination. The TPF is an indicator.

So, as the TPF is the part of Growth without explanations, some authors postulate that this part can be explains by technological progress. But is not rigorous, for example a good harvest can be due to a good combination of factors and a good period of sunshine.

I think that the normative economics indicates that not it should occur, however, in the real economy if it happens because the growth is based on productivity (efficiency, effectiveness, quality and economy).

Hi Muhamad,

In response to your questions:

could you please extend your statement as follows:

"In anycase, if any of the factors such as scale etc, overwhelm the technical progress and technical efficiency, then one could be negative while the others positive".

So one could imagine the possibility of negative economies of scale or scope, so even though technical change is positive, the total TFP, which is the sum of several factors, (a residual [usually in say production function models or index number/growth accounting approached]).

How do a scale factor can negatively affect TP or TE ?

This is actually a different question.  Technical change could be 'interacting' with scale or scope economies.  Without getting too technical, if you fully specify a translog (or similar taylor series or other such approximate expansion of an unknown function) production or cost function with all the higher order terms, there should be cross-elasticity terms on the levels of output and T (which is your technical progress time variable).  In essence, the expansion path of the production function is not homothetic with respect to technical change.  This is not dependent on a parametric (production function) approach, but I find that more intuititive (see Fare et al references for the non parametric approach).

Just to get the intuition, suppose we have a new nuclear power station with MES of 2000MW.  Our power system might not be big enough to accommodate that big a single plant.  As the system grows, there will be scale change (which may engender unit cost reductions per se), and also the new technology. (in this case scale change contribution to TFP and technical change are both positive).

I guess I could think of as a big organisation (below MES) grows bigger, maybe there are less good human interactions, and 'learning by collaboration reduces' (so an example where they go against each other).

What is the pure technological progress and pure technical efficiency ?

I mean if we could disentangle these -- normally, TFP is a mix.  technical progress is say, I learn how to use STATA better by learning by doing (you can get into semantics; some would call this human capital development, but in a production function would show up as technical change measuring labour input normally).

Technical efficiency, we could imagine a) I take too many breaks (slack) -- I'm not a cost minimiser (not technically efficient). or b) we don't have the correct mix of inputs--given prices -- another source of technical inefficiency.

Is technological change similar to technological progress?

there are semantic differences possible, but let's say they are the same.

What are the differences between technological progress, technological efficiency and TPF ? - ResearchGate. Available from: https://www.researchgate.net/post/What_are_the_differences_between_technological_progress_technological_efficiency_and_TPF [accessed Nov 10, 2015].

Well this is what I've been trying to explain.  TFP is usually the sum of these plus scale and scope economies.

I also would echo Yuri's points; there are many things that can impact TFP that could be seen as either mis-measurement or mis-specification of the model.  For example, we could also run down natural resources, or use chemicals that are polluting -- if the TFP does not measure these outputs as "Bads" and account for them negatively, then (measured) TFP could rise, even though the net 'social' output is worse.  The differences between the components of TFP, e.g., technical progress, could be further confounded -- e.g., a 'bettter' chemical such as DDT might show up as 'technology improvement' in better crop yields from lower insect damage, while the net social impact is negative.  You of course could try and specify some form of "Total Resource Productivity".

This problem is related to the well known growth theories in Economics. In my view, technological progress is the process of innovation which brings new products, methods and productive techniques, thereby pushing-up the output function at the macro level. See the canonical Solow's model for instance. The technological progress determines the per capita output growth. In turn, technical efficiency is more related to comparisons among alternative techniques into a specific industrial sector. Hence, it is a micro subject. At last, TPF is the measurement of the entire productivity of the productive factors available over time. There exist several diferent methods to measure it.

There is some interesting discussion and answers so thanks to all.  I'd just add that there is a difference between what you're measuring and what you 'believe' reality is (so now i'm getting into the semantics of what 'technological progress' is--I guess this can't be avoided.)  Muhamad's original question was 'could' these things be negative or positive, such as technical efficiency, technology change, and TFP in relation to crop production -- in terms of "measured observed outcomes"---yes, anyone could be negative and the others positive (in theory).  The overall technology change of the sector in reality -- well this might always be positive in theory -- but I'm aware of where technology was actually "lost" for a variety of reasons; evidently the Romans had certain types of pumps and aquaducts and the like that got LOST with the fall of Rome and were not rediscovered until the Middle Ages. 

The differences between TE, TFP and Technological progress is crucial for analysis of economic growth, esp., empirical determinants. Typically Productivity (the Solow residual or the measure of our ignorance) is explained in endogenous growth models and its descendants. It depends on TE and Technological progress derivative of knowledge-models. Efficiency depends on all the factors, like culture, geography, institutions, and governance is an important parameter underlying these. 

Thus, effectiveness of Technological progress depends on 'efficiency' of utilizing it contingent on fundamentals, and TE is resultant of both factors. Hope it helps a bit.

Dear M K Bahri, you basic and other sub-questions really need empirical study to get accurate answers. Technical progress, Technological Efficiency and TPF are correlated. Moving from man-driven machine to power-driven machine is technological progress. this technological progress raises the production efficiency of input engaged in production process is increase in technological efficiency, assuming no change in quality and quantity of these inputs. This improvement improves the TPF, the productivity of all factors engaged in production process increase. In long run. the application of Law of Variable Proportions at the point of time of optimum utilization, there will ne negative growth.  I hope this my explanation  may have answers to all your questions.