Open AccessAre Our Export-Oriented Industries Technically More Efficient?
Author(s) -
Tariq Mahmood,
Ejaz Ghani,
Musleh ud Din
Publication year - 2015
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/v54i2pp.97-121
Subject(s) - data envelopment analysis , returns to scale , stochastic frontier analysis , production (economics) , scale (ratio) , econometrics , efficient frontier , economics , industrial organization , business , mathematics , statistics , microeconomics , financial economics , portfolio , physics , quantum mechanics
This paper makes a comparison of technical efficiency scoresbetween groups of exporting and non-exporting industries. Using datafrom Census of Manufacturing Industries in Pakistan (2005-06), technicalefficiency scores of 102 large scale manufacturing industries areestimated. Stochastic Frontier Analysis as well as Data EnvelopmentAnalysis technique are used to estimate technical efficiency scores. InStochastic Frontier Analysis Translog and Cobb-Douglass ProductionFunctions are specified, whereas in Data Envelopment Analysis technique,efficiency scores are computed under the assumptions of Constant Returnsto Scale as well as Variable Returns to Scale. Industries showing hightechnical efficiency include Tobacco Products, Refined PetroleumProducts, Carpets and Rugs, and Meat and Meat Products. Industriesshowing low technical efficiency include Refractory Ceramic Products,Electricity Distribution and Control Apparatus, Fish and Fish Products,Basic Precious Metals and Aluminum and its Products. Comparison of meanefficiency scores between exporting and non-exporting industries doesnot indicate any significant difference between efficiency scores acrosstypes of industries. JEL Classification: D24, L6, O14, F14 Keywords:Manufacturing Industries, Technical Efficiency, Stochastic FrontierAnalysis, Data Envelopment Analysis, International Trade