Technical Efficiency of Domestic and Foreign Firms in Indian Manufacturing: A Firm Level Panel Analysis

2015 ◽  
Vol 4 (2) ◽  
pp. 7
Author(s):  
Pritish Kumar Sahu
Keyword(s):  
Technical Efficiency ◽  
Foreign Firms ◽  
Panel Analysis ◽  
Firm Level

scholarly journals THE EFFECT OF FOREIGN DIRECT INVESTMENT SPILLOVER ON THE LEVEL OF TECHNICAL EFFICIENCY IN LARGE AND MEDIUM MANUFACTURING INDUSTRY IN EAST JAVA

2020 ◽  
Vol 5 (1) ◽  
pp. 6
Author(s):  
Ahmad Oktabri Widyananda ◽  
Dyah Wulan Sari
Keyword(s):  
Foreign Direct Investment ◽  
Technical Efficiency ◽  
Direct Investment ◽  
Manufacturing Industry ◽  
Positive Impact ◽  
Stochastic Frontier ◽  
Positive Influence ◽  
Foreign Firms ◽  
Stochastic Frontier Approach ◽  
Firm Level

Foreign Direct Investment (FDI) takes an important role in the development process, especially in developing countries. The purpose of this study is to examine and analyze FDI spillover on the level of technical efficiency in the large and medium manufacturing industry in East Java. This study uses a time-varying stochastic frontier approach for firm-level panel data of the East Java manufacturing industry. The results show that all factors in this study affect the level of technical efficiency of large and medium industries in East Java. Variable foreign share, FDI horizontal spillover, and firm size have a positive influence on the technical efficiency of the industry. Whereas the variable FDI backward spillover, FDI forward spillover and the level of market concentration negatively affect the level of technical efficiency of the industry. Finally, it’s needed to build synergies and sustainable relationships between products produced by domestic and foreign firms. Thus, the presence of foreign firms in East Java could have a positive impact on improving the technical efficiency of the domestic industry both at the upstream and downstream levels. Keywords: Foreign Direct Investment Spillover, Technical Efficiency, East Java IndustryJEL Classification: F21, L60, D24

Technical Efficiency and Total Factor Productivity Growth of Indonesian Manufacturing Industry: Does Openness Matter?

2021 ◽  
pp. 232102222110244
Author(s):  
Mohammad Zeqi Yasin
Keyword(s):  
Technical Efficiency ◽  
Total Factor Productivity ◽  
Absorptive Capacity ◽  
Manufacturing Industry ◽  
Raw Material ◽  
Foreign Firms ◽  
Factor Productivity ◽  
Stochastic Production Frontier ◽  
Firm Level ◽  
Tfp Growth

In this paper, we examine the contribution of openness variables such as import, export, absorptive capacity and foreign-shared capital to Indonesian firms’ technical efficiency and total factor productivity (TFP) growth. We use the most recent firm-level panel data of 23 subsectors in the manufacturing industry over the period from 2008 to 2015. We employ time-varying stochastic production frontier to examine factors affecting technical efficiency and to decompose the components of TFP growth. The results reveal that export and absorptive capacity alone contribute to the efficiency improvement of the firms under study. To speak specifically of foreign firms, they contribute to improving efficiency if they interact with absorptive capacity and imported raw material intensity. We identify that, on an average, the manufacturing industry in Indonesia experienced positive TFP growth. However, among 23 subsectors, there are only few subsectors that benefitted from the openness variables. In 2014, 15 out of 23 subsectors experienced negative TFP growth. This implies that, in 2014, there were some macroeconomic issues regarding the contracted policy, for example, the subsidy removal and the basic electricity tariff. JEL Classification: C23, D24, F23, O14

Impact of Determinants of Industrial Development on Employment and Wages in Indian Manufacturing

2020 ◽  
pp. 18-30
Keyword(s):  
Technical Efficiency ◽  
Total Factor Productivity ◽  
Technical Change ◽  
Positive Impact ◽  
Manufacturing Sector ◽  
Factor Productivity ◽  
Firm Level ◽  
Employment Level ◽  
The Impact ◽  
Level Performance

ABSTRACT The present study was undertaken to explore the evolution of the impact of firm-level performance on employment level and wages in the Indian organized manufacturing sector over the period 1989-90 to 2013-14. One of the major components of the economic reform package was the deregulation and de-licensing in the Indian organized manufacturing sector. The impact of firm-level performance on employment and wages were estimated for Indian organized manufacturing sector in major sub-sectors in India during the period from 1989-90 to 2013-14 of the various variables namely profitability ratio, total factor productivity change, technical change, technical efficiency, openness (export-import), investment intensity, raw material intensity and FECI in total factor productivity index, technical efficiency, and technical change. The study exhibited that all explanatory variables except profitability ratio and technical change cost had a positive impact on the employment level. Out of eight variables, four variables such as net of foreign equity capital, investment intensity, TFPCH, and technical efficiency change showed a positive impact on wages and salary ratio and rest of the four variables such as openness intensity, technology acquisition index, profitability ratio, and technical change had negative impact on wages and salary ratio. In this context, the profit ratio should be distributed as per the marginal rule of economics such as the marginal productivity of labour and capital.

scholarly journals Determinants of firm-level technical efficiency: evidence using stochastic frontier approach

2008 ◽  
Vol 5 (3) ◽  
pp. 225-239 ◽  
Author(s):  
Evis Sinani ◽  
Derek C. Jones ◽  
Niels Mygind
Keyword(s):  
Technical Efficiency ◽  
Firm Size ◽  
Stochastic Frontier ◽  
Returns To Scale ◽  
Budget Constraints ◽  
Stochastic Frontiers ◽  
Firm Level ◽  
Soft Budget Constraints ◽  
Labor Quality ◽  
Enhance Efficiency

By estimating stochastic frontiers we investigate the determinants and dynamics of firm efficiency. We use a representative sample of Estonian firms for the period 1993-1999 – and are able to address problems that plague much previous work, such as the endogeneity of ownership. Our main findings are that: (i) foreign ownership increases technical efficiency; (ii) firm size and higher labor quality enhance efficiency, while soft budget constraints adversely affect efficiency; (iv) Estonian firms operate under constants returns to scale; (v) the percentage of firms operating at high levels of efficiency increases over time. As such our findings provide support for hypotheses that a firm’s ownership structure and its characteristics such as firm size, labor quality, soft budget constraints and time of privatization are important for its technical efficiency.

Contesting the State: Discourses of the Asian Economic Crisis and Mediating Strategies of Electronics Firms in Singapore

2003 ◽  
Vol 35 (3) ◽  
pp. 463-488 ◽  
Author(s):  
Karen P Y Lai ◽  
Henry Wai-chung Yeung
Keyword(s):  
Economic Crisis ◽  
Spatial Scales ◽  
Foreign Firms ◽  
Firm Level ◽  
Economic Space ◽  
National Space ◽  
Informal Information ◽  
Space Economy ◽  
Material Conditions ◽  
Discursive Constructions

In the last decade or so, human geographers have paid greater attention to the significance of discourses. We acknowledge the importance of discursive constructions and metaphorical representations of economic space, and extend the argument by examining the practices that may follow from such discourses. With use of empirical data from a firm-level survey and interviews with representatives of electronics firms in Singapore, we focus on contested interpretations of the Asian economic crisis at the firm level: how they might differ from state-driven discourses, and the extent to which state discourses (embodied in ministerial speeches and policy initiatives) were accepted, contested, and negotiated through firm-specific practices. The different counterdiscourses and responses of local and foreign firms are also compared. Results show that discourses at the national (state) scale were challenged and contested by firms within the same national space economy because of such material conditions as firm-specific circumstances, spatial extensiveness of their intrafirm and interfirm networks, and their access to various formal and informal information channels. The sampled firms offerered their own readings of the crisis that often contradicted the effectiveness and usefulness of certain policy responses orchestrated at the national scale. Their abilities to weather the crisis were also differentiated significantly between local and foreign firms. The study therefore highlights the importance of understanding the complex interrelationships between discourses and practices at different spatial scales and their capacity to produce (un)intended geographical outcomes.

Is a Corruption Crackdown Really Good for the Economy? Firm-Level Evidence from China

2020 ◽  
Author(s):  
Zhiyuan Chen ◽  
Xin Jin ◽  
Xu Xu
Keyword(s):  
Negative Impact ◽  
Foreign Firms ◽  
Private Firms ◽  
Firm Level ◽  
Personal Connections ◽  
Before And After ◽  
Short Run ◽  
The Government ◽  
Negative Impacts ◽  
The Impact

Abstract We study the impact of anticorruption efforts on firm performance, exploiting an unanticipated corruption crackdown in China’s Heilongjiang province in 2004. We compare firms in the affected regions with those in other inland regions before and after the crackdown. Our main finding is an overall negative impact of the crackdown on firm productivity and entry rates. Furthermore, these negative impacts are mainly experienced by private and foreign firms, while state-owned firms are mostly unaffected. We present evidence concerning two potential explanations for our findings. First, the corruption crackdown may have limited bribery opportunities that helped private firms operate. Second, the corruption crackdown may have interfered with personal connections between private firms and government officials to a greater extent than institutional connections between state-owned firms and the government. Overall, our findings suggest that corruption crackdowns may not restore efficiency in the economy, but instead lead to worse economic outcomes, at least in the short run (JEL L2, M1, O1).

scholarly journals Political Risk Insurance: A New Firm-level Data Set

2019 ◽  
Vol 64 (5) ◽  
pp. 987-1006
Author(s):  
Vincent Arel-Bundock ◽  
Clint Peinhardt ◽  
Amy Pond
Keyword(s):  
Political Risk ◽  
Private Investment ◽  
Foreign Firms ◽  
Firm Level ◽  
Data Set ◽  
Insurance Contracts ◽  
Indirect Measures ◽  
Level Data ◽  
New Firm ◽  
Risk Insurance

When do governments impose costs on foreign firms? Many studies of foreign direct investment focus on incentives for government expropriation, but scholars are often forced to rely on indirect measures of expropriation to conduct empirical analyses. This article introduces a data set which includes information on over 5,000 political risk insurance contracts issued by the US Overseas Private Investment Corporation since 1961, and on all the claims filed by investors under these contracts. These detailed insurance data allow us to study the determinants of foreign investors’ losses from a variety of sources, including expropriation, inconvertibility, and violent conflict. To illustrate the benefits of these data for hypothesis testing, we adopt a comprehensive empirical approach and explore both shared and distinct causes across risk categories.

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