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Effects of fixed capital investments on technical efficiency in food industry

Author

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  • Shchetynin, Yevhenii

    (National Research University Higher School of Economics, Moscow)

  • Nazrullaeva, Eugenia

    (National Research University Higher School of Economics, Perm, Russia)

Abstract

Are firms that make investments in fixed assets more efficient? Can fixed capital investments contribute to the improvement of a firm’s production technologies? In this paper we estimate the stochastic production frontier using firm-level data for food industry in 2003–2010, taking into account a possible relationship between fixed capital investments technical efficiency. We use the «Ruslana» (Bureau van Dijk) database, which contains financial information on companies in Russia. Our results show that in food industry technical efficiency is higher for larger firms which invested in fixed assets in the previous period. Technical efficiency has been gradually decreasing after the 2008 crisis, with small and average-sized firms affected most negatively.

Suggested Citation

  • Shchetynin, Yevhenii & Nazrullaeva, Eugenia, 2012. "Effects of fixed capital investments on technical efficiency in food industry," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 28(4), pages 63-84.
    • Handle: RePEc:ris:apltrx:0196
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    Cited by:

    1. Nikolskiy, Ilya & Furmanov, Kirill, 2023. "Assessing the accuracy of efficiency rankings obtained from a stochastic frontier model," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 71, pages 128-142.
    2. Ipatova, Irina, 2015. "The dynamics of total factor productivity and its components: Russian plastic production," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 38(2), pages 21-40.
    3. Tsvetkova, Anna, 2021. "Technical efficiency trends of Russian firms in 2013–2018," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 63, pages 91-116.
    4. Mogilat , Anastasia & Ipatova, Irina, 2016. "Technical efficiency as a factor of Russian industrial companies’ risks of financial distress," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 42, pages 05-29.
    5. Shchetynin, Yevhenii, 2015. "Effects of imports on technical efficiency in Russian food industry," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 37(1), pages 27-42.
    6. Mamonov, M. & Pestova, A., 2015. "The Technical Efficiency of National Economies: Do the Institutions, Infrastructure and Resources Rents Matter?," Journal of the New Economic Association, New Economic Association, vol. 27(3), pages 44-78.
    7. Ipatova, Irina & Peresetsky, Аnatoly, 2013. "Technical efficiency of Russian plastic and rubber production firms," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 32(4), pages 71-92.

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    More about this item

    Keywords

    stochastic frontier; fixed capital investment; firms; technical efficiency; food industry.;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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