EconPapers    
Economics at your fingertips  
 

Using a novel DEA-based model to investigate capacity utilization of Chinese firms

Hirofumi Fukuyama (), Yao-yao Song, Xian-tong Ren and Guo-liang Yang

Omega, 2022, vol. 106, issue C

Abstract: Chinese steel and iron industry has encountered a series of problems such as overcapacity after the phase of asset accumulation and technical improvement. To fully address the issue of the capacity utilization (CU) measurement considering the possibility of changing the quasi-fixed input, we propose a novel DEA-based method in which the reduction of the fixed input is in line with the intention of the Chinese government to remove backward capacity in an intermediate run concept. Meanwhile, three alternative input utilization indicators are clearly categorized and provide information on individual performance and the utilization of quasi-fixed input. An illustrative case study of 48 Chinese steel and iron firms is conducted to examine their CU over the period of 2009-2013. The empirical results indicate that the sample firms made better use of their resources during the investigated period, and the regional investment indicators possess statistically significant positive or negative correlation on CU values. A comparative study with an existing model also demonstrates the validity of the proposed model. On the basis of the above findings, relevant policy implications and suggestions are proposed to support the policymaking in Chinese steel and iron firms or industry.

Keywords: Data envelopment analysis; Capacity utilization; Intermediate-run; Chinese steel and iron firms (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0305048321001432
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jomega:v:106:y:2022:i:c:s0305048321001432

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_1&version=01

DOI: 10.1016/j.omega.2021.102534

Access Statistics for this article

Omega is currently edited by B. Lev

More articles in Omega from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2025-03-19
Handle: RePEc:eee:jomega:v:106:y:2022:i:c:s0305048321001432