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Are Our Export-Oriented Industries Technically More Efficient?

Tariq Mahmood, Ejaz Ghani and Musleh Din
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Tariq Mahmood: Pakistan Institute of Development Economics (PIDE), Islamabad.
Ejaz Ghani: Pakistan Institute of Development Economics (PIDE), Islamabad.
Musleh Din: Pakistan Institute of Development Economics (PIDE), Islamabad.

The Pakistan Development Review, 2015, vol. 54, issue 2, 97-121

Abstract: This paper makes a comparison of technical efficiency scores between groups of exporting and non-exporting industries. Using data from Census of Manufacturing Industries in Pakistan (2005-06), technical efficiency scores of 102 large scale manufacturing industries are estimated. Stochastic Frontier Analysis as well as Data Envelopment Analysis technique are used to estimate technical efficiency scores. In Stochastic Frontier Analysis Translog and Cobb-Douglass Production Functions are specified, whereas in Data Envelopment Analysis technique, efficiency scores are computed under the assumptions of Constant Returns to Scale as well as Variable Returns to Scale. Industries showing high technical efficiency include Tobacco Products, Refined Petroleum Products, Carpets and Rugs, and Meat and Meat Products. Industries showing 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 mean efficiency scores between exporting and non-exporting industries does not indicate any significant difference between efficiency scores across types of industries.

Keywords: Manufacturing Industries; Technical Efficiency; Stochastic Frontier Analysis; Data Envelopment Analysis; International Trade (search for similar items in EconPapers)
JEL-codes: D24 L6 O14 F14 (search for similar items in EconPapers)
Date: 2015
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