Thursday, March 25, 2010

PL 10/10: Size and productivity

Filed under: statistics — plinius @ 10:30 am

Politicians and administrators are very interested in efficiency.

My good colleague Markku Laitinen – we work together in the Statistics and Evaluation Section – has just posted an intereresting comment on library productivity, based on a paper I presented at the Northumbria Meeting in South Africa (Stellenbosch) in 2007.

I reproduce his comment below, and also answer here – to give more people a chance to follow the discussion.

Markku wrote

The result or your survey that service indicator (Loans + Visits) per capita used in Finland combined with the resource indicator (Wages + Media budget) used in Norway (?) equals to formula used in Finnish public libraries to describe economical effectiveness: In Finland, (Expenditure on staff + Expenditure on library materials) / (Library visits + Loans, total) is counted.

I agree with you that it does give a picture of the relationship between input and output, but the indicator has some constraints, and I have in my lectures and discussions elicited some criticism about it.

Namely, this indicator is strongly dependent of size of the library. It is dangerous if this is used e.g. comparing the effectiveness of library with the national average. I have counted that 20 biggest municipal libraries in Finland actually define the “good mean value” of the country, and the 20 smallest libraries are far away from that level. The result of the 20 biggest libraries did not deviate from the national average, and even counting the 20 biggest and 20 smallest together showed an average of those 40 libraries that did not deviate from the national average.

My response

Thanks for the point raised, which I think is quite important.

Productivity is the relationship between input (resources) and output (services). A widely used – but very rough – indicator of productivity  is the number of loans per staff member (FTE). A rather better indicator is the ratio between (loans + visits), on the one hand, and (staff + media expenses) on the other.

The latter is used in Finland, and I am trying to get it introduced in Norway. New Zealand follows a similar approach – they work with (total) costs per transaction (per capita values), where

  • transactions = loans + visits + reference enquiries + no. of library memberships

Whatever ratio we choose, it is likely that productivity will decrease when we go from large to small libraries. Economies of scale are common in most branches of the economy – and I would expect that to apply to libraries as well.

That is why we should not look at national averages, but rather at averages (or medians, as I prefer), for municipalities of roughly the same size. The Stellenbosch paper dealt with the strength of correlations inside each size group rather than productivity as such. But the same data can be used to show Markku’s point. The most recent Norwegian statistics are from 2008, and I found the following values for median productivity – defined as (loans+visits)*100/(salary+media expenses):

The same pattern is found in earlier years.



1 Comment »

  1. […] PL 10/10: Size and productivity. Markku Laitinen comments on a study presented at Stellenbosch in 2007 […]

    Pingback by P 8/12: News from the North « Plinius — Sunday, March 4, 2012 @ 10:32 am

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