The analysis of technical efficiency of Russian retail companies in 2019–2023

Galina Besstremyannaya and Yulia Kuznetsova
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Galina Besstremyannaya: HSE University, Moscow, Russian Federation
Yulia Kuznetsova: HSE University, Moscow; Rostov Regional Division of the Southern Main Branch of the Central Bank of the Russian Federation, Rostov-on-Don, Russian Federation

Applied Econometrics, 2026, vol. 82, 26-46

Abstract: This paper studies the technical efficiency of Russian retail companies in 2019 to 2023 using stochastic frontier analysis (SFA) with the Battese and Coelli (1995) model. A translogarithmic production function is employed for estimations. The dependent variable is company revenue, and the production factors are the average number of employees, fixed assets, and assets less fixed assets, along with year-specific dummies. The mean distribution of the inefficiency component is modeled as a function of company age, total assets, and the regional Herfindahl–Hirschman index, calculated using a sample from the SPARK database. The results of our analysis show that labor makes the largest contribution to revenue growth, with increasing returns to scale, albeit close to constant. Revenue increased annually throughout the period under study. Average technical efficiency in the industry exhibits an inverted-U-shaped relationship with firm age and size. Technical efficiency declined significantly during the pandemic but showed steady growth in subsequent years.

Keywords: efficiency analysis; stochastic frontier analysis; heterogeneity; panel data model; retail industry (search for similar items in EconPapers)
JEL-codes: C33 C4 D22 D24 L25 L81 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:ris:apltrx:022708

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