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Stochastic frontier analysis of productive efficiency in China's Forestry Industry

Jiandong Chen, Yinyin Wu, Malin Song and Zunhong Zhu

Journal of Forest Economics, 2017, vol. 28, issue C, 87-95

Abstract: Forest resources are vital to the development of green economics. Given the booming development of China's forestry industry and its ambitious reforestation efforts in the developing world, this paper is the first to use the output distance function to synthetically consider the economic and ecological outputs of China's forestry industry, and discuss its productive efficiency with a stochastic frontier model. Control and environmental variables are incorporated to capture heterogeneity in China's forestry industry, which helps us get an unbiased estimation. The empirical results show that there was no obvious efficiency disparity among China's economic regions except Northeastern China, and the state-owned forestry structure has a significantly negative effect on productive efficiency in China's forestry industry. Moreover, provinces with poor productive performance in the forestry industry such as Inner-Mongolia, Heilongjiang, and Hebei have been identified and their individual characteristics regarding productive efficiency have also been analyzed. The findings in this paper have targeted and practical implications for the development of China's forest green economy.

Keywords: Forestry industry; Stochastic frontier analysis; Output distance function; Heterogeneity (search for similar items in EconPapers)
Date: 2017
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