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Ownership, autonomy, incentives and efficiency: Evidence from the forest product processing industry in China

Haoran He and Qian Weng

Journal of Forest Economics, 2012, vol. 18, issue 3, 177-193

Abstract: Using enterprise-level data from China's Northeast-Inner Mongolia state-owned forest area for the year 2004, this paper investigates the technical efficiency of forest product processing mills and the relationship between institutional and managerial practices and efficiency. A two-stage procedure proposed by Simar and Wilson (2007) is adopted. In the first stage, a bootstrapped data envelopment analysis (DEA) model is used to compute the efficiency scores. In the second stage, the bootstrapped DEA scores are estimated over a set of mills’ institutional and managerial systems and other characteristics with a bootstrapped truncated regression. The results show that there is a wide dispersion in the technical efficiency among mills. Private ownership, autonomy and mill size have statistically significant positive impacts on efficiency. These results provide support for the ongoing reform and implications for future development of this area.

Keywords: Forest product processing mills; Data envelopment analysis; Truncated regression; Bootstrap; China (search for similar items in EconPapers)
JEL-codes: D23 D24 L73 L78 (search for similar items in EconPapers)
Date: 2012
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DOI: 10.1016/j.jfe.2012.02.001

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Handle: RePEc:eee:foreco:v:18:y:2012:i:3:p:177-193