Ownership and technical efficiency in Malaysia's automotive industry: A stochastic frontier production function analysis

Noor Aini Khalifah

The Journal of International Trade & Economic Development, 2013, vol. 22, issue 4, 509-535

Abstract: This article examines the direct effect of the extent of foreign ownership on technical efficiency in Malaysia's automotive industry by applying a stochastic frontier production function analysis to micro-panel data over the years 2000--2004. Technical efficiency in the overall automotive industry is positively related to the degree of vertical integration, the size of establishments in the respective sub-sectors, a higher quality of the work force, and a higher foreign ownership share in the establishment combined with higher net-import intensity. Foreign ownership and net-export intensity are not significant determinants of technical efficiency inthe parts sub-sector. Although majority foreign ownership is not allowed in the assembly sub-sector, this sub-sector is large, with asmall number of establishments generating scale economies in the automotive industry. The determinants of technical efficiency in the parts sub-sector show that foreign ownership per se does not enhance technical efficiency since other determinants like the degree of vertical integration and the size of establishments are significant determinants of technical efficiency.

Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://hdl.handle.net/10.1080/09638199.2011.571702 (text/html)
Access to full text is restricted to subscribers.

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:taf:jitecd:v:22:y:2013:i:4:p:509-535

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RJTE20

DOI: 10.1080/09638199.2011.571702

Access Statistics for this article

The Journal of International Trade & Economic Development is currently edited by Pasquale Sgro, David E.A. Giles and Charles van Marrewijk

More articles in The Journal of International Trade & Economic Development from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().