Technical efficiency and input-driven growth in Indian engineering goods industry during post-reform period: stochastic frontier approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Vasim Akram ◽  
Asheref Illiyan
Keyword(s):  
Technical Efficiency ◽  
High Performance ◽  
Stochastic Frontier ◽  
Capacity Utilization ◽  
Output Growth ◽  
Infrastructure Development ◽  
Efficiency Change ◽  
Stochastic Frontier Approach ◽  
Content Type ◽  
Reform Period

PurposeThe purpose of this study is to examine the performance of Indian engineering goods industry by measuring the technical efficiency and input-driven growth.Design/methodology/approachThe study used the panel data of six firms from the period of 1991–92 to 2014–15 compiled from Annual Survey of Industries (ASI), India and output-oriented econometric techniques such as pooled OLS model, and stochastic frontier approach has been applied to measure the technical efficiency.FindingsThe results suggest that the prime sources of high performance in engineering goods industry, which has recorded 8.8% output growth, are primarily contributed by inputs driven growth (8.2%) during the post-reform period, while the effect of technological change is minimal (0.1%) and technical efficiency change is negative (−0.2%). It was due to sluggishness, outdated technology and underutilization of resources in Indian economy.Research limitations/implicationsThis research paper is limited to engineering goods industry based on concorded macro data. The recommendations are that India should pursue policies and programs which may focus on technology acquisition, skill enhancement of labor, better capacity utilization, R&D and infrastructure development that may augment the technical change and technical efficiency change of the sector.Originality/valueThis research provides robust and significant estimates of technical efficiency and adds valuable insights to the existing literature by identifying the potential areas that improves the performance of Indian engineering goods industry.

scholarly journals Agricultural Technical Efficiency of Smallholder Farmers in Ethiopia: A Stochastic Frontier Approach

Land ◽  
2021 ◽  
Vol 10 (3) ◽  
pp. 246
Author(s):  
Markose Chekol Zewdie ◽  
Michele Moretti ◽  
Daregot Berihun Tenessa ◽  
Zemen Ayalew Ayele ◽  
Jan Nyssen ◽  
...  
Keyword(s):  
Technical Efficiency ◽  
Crop Production ◽  
Large Scale ◽  
Positive Impact ◽  
Smallholder Farmers ◽  
Stochastic Frontier ◽  
Crop Productivity ◽  
Small Scale ◽  
Stochastic Frontier Approach ◽  
Small Scale Irrigation

In the past decade, to improve crop production and productivity, Ethiopia has embarked on an ambitious irrigation farming expansion program and has introduced new large- and small-scale irrigation initiatives. However, in Ethiopia, poverty remains a challenge, and crop productivity per unit area of land is very low. Literature on the technical efficiency (TE) of large-scale and small-scale irrigation user farmers as compared to the non-user farmers in Ethiopia is also limited. Investigating smallholder farmers’ TE level and its principal determinants is very important to increase crop production and productivity and to improve smallholder farmers’ livelihood and food security. Using 1026 household-level cross-section data, this study adopts a technology flexible stochastic frontier approach to examine agricultural TE of large-scale irrigation users, small-scale irrigation users and non-user farmers in Ethiopia. The results indicate that, due to poor extension services and old-style agronomic practices, the mean TE of farmers is very low (44.33%), implying that there is a wider room for increasing crop production in the study areas through increasing the TE of smallholder farmers without additional investment in novel agricultural technologies. Results also show that large-scale irrigation user farmers (21.05%) are less technically efficient than small-scale irrigation user farmers (60.29%). However, improving irrigation infrastructure shifts the frontier up and has a positive impact on smallholder farmers’ output.

Technical efficiency and its determinants in the Indian textile garments industry

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Abdulla ◽  
Shiv Kumar
Keyword(s):  
Panel Data ◽  
Technical Efficiency ◽  
Textile Industry ◽  
Small And Medium Enterprises ◽  
Stochastic Frontier ◽  
Efficiency Score ◽  
Value Chains ◽  
Small Scale ◽  
Content Type ◽  
Medium Enterprises

Purpose This paper aims to examine technical efficiency and its determinants in Indian textile garments industry in post-agreement on textiles and clothing regime and evaluate the technical efficiency among micro, small and medium enterprises (MSMEs) firms. Design/methodology/approach This study uses unbalanced panel data for the period 2005–2010 to 2015–2016. The stochastic frontier function is used to estimate technical efficiency and its determinants. Findings The results show that the overall ecosystem of textile garments’ value chains could be improved to enhance the technical efficiency thereof. The result also reveals that small-scale firms have the highest technical efficiency scores, and medium-scale firms have the least technical efficiency score among all the categories of MSMEs. Research limitations/implications The textile garments industry needs to define its innovation strategies, as these strategies lead to different results that can be achieved only through the management of resources dedicated to the generation and implementation of innovations. Practical implications This study has shown that to offset India’s cost disadvantage in the international markets, there is a need to develop an ecosystem of textile manufacturing and value chains, eliminate the inverted duty structure (where inputs are taxed at a higher rate than the final product) and switch over from shuttle looms toward shuttle-less looms. This would unleash the potential of textile and garments industry and make it globally competitive and technically efficient. Further, there will be an alignment with the ease of doing business with an appropriate mix of policy, technology, institution, infrastructure, information and services. Originality/value Using frontier production function takes stochastic context into account for the dynamic character of technical efficiency and its components. Most of the past studies have assessed technical efficiency at the aggregate level using three-digit National Industrial Classification (NIC) or four-digit NIC code. An analysis at higher levels of aggregation masks the variation in technical efficiency. This study used five-digit NIC data to measure the firm-specific technical efficiency of the textile industry. According to the authors’ knowledge, this study is the first of its kind in the Indian textile industry using stochastic frontier approach and panel data. Further, it also looks at the contribution of different determinants in technical efficiency to the firms.

scholarly journals Efficacité Technique des Petits Producteurs du Maïs au Bénin

2018 ◽  
Vol 14 (19) ◽  
pp. 109
Author(s):  
Fawaz A. Adéchinan Aminou
Keyword(s):  
Technical Efficiency ◽  
Stochastic Frontier ◽  
Farm Households ◽  
Farm Income ◽  
Selling Price ◽  
Stochastic Frontier Approach ◽  
Access To Credit ◽  
Seed Distribution ◽  
Production Area ◽  
Low Efficiency

This study examines how small maize farmers allocate their production inputs and identifies the elements that characterize efficient farms. A Cobb Douglas stochastic frontier approach is used to estimate farm level technical efficiency of maize farmers. Average technical efficiency of sampled farms was estimated to be 65.40% with a minimum of 20.47% and a maximum of 93.46%. The study further showed that the farmers’ sex, the use of improved seeds, the maize selling price, the non-farm income, the contact with an NGO, the access to credit and the production area played a positive and significant role in improving technical efficiency. The results imply that government can save resources used in extension services and focus on its improved seed distribution policy. Also, imperfections in the labor/capital market contribute to the low efficiency of farm households.

The Covid-19 pandemic and technical efficiency of Russian firms: a stochastic frontier production function approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Parul Singh ◽  
Kashika Arora ◽  
Areej Aftab Siddiqui
Keyword(s):  
Technical Efficiency ◽  
Production Function ◽  
Market Competition ◽  
Stochastic Frontier ◽  
Innovation Activity ◽  
Peak Period ◽  
Role Of Government ◽  
Content Type ◽  
External Assistance ◽  
The Impact

Purpose This paper aims to undertake the efficiency analysis in the form of stochastic frontier to estimate a Cobb–Douglas production function by controlling for the heterogeneity across Russian firms by including firm size, ownership, age, innovation activity and market competition. Design/methodology/approach During the peak period of Covid-19, certain firms witnessed either a decrease or increase in sales. Using this segregation of firms from World Bank’s Covid-19 impact surveys follow-up to the Enterprise Survey for Russia, this study empirically investigates the determinants of technical efficiency of these firms focusing on the role of government assistance. Findings The findings suggest that by segregating firms in terms of sales, different internal factors can enable in steering through pandemic situation besides just depending on external assistance. Originality/value One of the few papers to analyse the impact of the pandemic on Russian firms by considering World Bank Covid Survey.

Evaluating the effect of subsidies for rural development on agri-food and forestry firms

2019 ◽  
Vol 27 (80) ◽  
pp. 150-167
Author(s):  
José A. Pérez-Méndez ◽  
María Pérez-Urdiales ◽  
David Roibas
Keyword(s):  
Rural Development ◽  
Technical Efficiency ◽  
Technical Progress ◽  
Stochastic Frontier ◽  
Content Type ◽  
Factors Affecting ◽  
Forestry Industry ◽  
The One ◽  
The Impact ◽  
Positive Effect

Purpose This paper aims to evaluate the impact of the subsidies established by Measure 123 of the Rural Development Policy on the productivity of a sample of agri-food and forestry companies in the region of Asturias over the period 2006-2009. Design/methodology/approach The authors estimate a stochastic frontier function which allows subsidies to be considered as affecting both the level of technical efficiency and technical progress. Findings The results show that while subsidies have a positive effect on the technical progress of companies in the agri-food industry, for the forestry industry, the effect materializes as an improvement in technical efficiency. Additionally, other factors affecting either, technical progress and technical efficiency were identified. Originality/value This study adopts a model that allows the separate identification of the effect of subsidies on the level of efficiency, on the one hand, and on the technical progress, on the other.

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