Open AccessTechnical Efficiency of Pakistan’s Manufacturing Sector: A Stochastic Frontier and Data Envelopment Analysis
Author(s) -
Musleh-ud Din,
Ejaz Ghani,
Tariq Mahmood
Publication year - 2007
Publication title -
pakistan development review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.154
H-Index - 26
ISSN - 0030-9729
DOI - 10.30541/v46i1pp.1-18
Subject(s) - data envelopment analysis , manufacturing sector , econometrics , frontier , production–possibility frontier , economics , stochastic frontier analysis , parametric statistics , nonparametric statistics , scale (ratio) , manufacturing , production (economics) , returns to scale , statistics , mathematics , macroeconomics , business , geography , cartography , archaeology , marketing
This paper examines the efficiency of the large-scalemanufacturing sector of Pakistan using parametric as well asnon-parametric frontier techniques. Production frontiers are estimatedfor two periods─1995-96 and 2000-01─for 101 industries at the 5-digitPSIC. The results show that there has been some improvement in theefficiency of the large-scale manufacturing sector, though the magnitudeof improvement remains small. The results are mixed at the disaggregatedlevel: whereas a majority of industrial groups have gained in terms oftechnical efficiency, some industries have shown deterioration in theirefficiency levels. The results from both the approaches are consistent,and in line with similar studies.