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Measuring productivity in the biotechnology industry using the global Malmquist index

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  • Chun-Hsien Wang
  • Jun-Yen Lee
  • Yi-Hua Chang

Abstract

This study applies the Data Envelopment Analysis (DEA)-based Malmquist Productivity Index (MPI) to measure productivity growth in Taiwanese biotechnology industry over time. The contemporaneous MPI and the global MPI are used to estimate and compare changes in productivity. In this study, we provide a single measurement of productivity change and its decompositions, that is, the global MPI. This index satisfies the circularity property and is free from the problem of base period dependency. Our results show that changes in productivity in the biotechnology industry are progressing. Under the assumption of Variable Returns to Scale (VRS), the sources of productivity change could be decomposed into Efficiency Change (EC), Best Practice Change (BPC) and Scale Change (SC). As result, the BPC and SC are progressing except for EC.

Suggested Citation

  • Chun-Hsien Wang & Jun-Yen Lee & Yi-Hua Chang, 2012. "Measuring productivity in the biotechnology industry using the global Malmquist index," Applied Economics Letters, Taylor & Francis Journals, vol. 19(9), pages 807-812, June.
    • Handle: RePEc:taf:apeclt:v:19:y:2012:i:9:p:807-812
    DOI: 10.1080/13504851.2011.605552
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    Cited by:

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    2. Concepción Rubio‐Picón & Francisco Velasco‐Morente & Encarnación Ramos‐Hidalgo & María A. Agustí, 2023. "The effect of innovation efficiency management on performance: Differences according to organizational size," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(1), pages 336-358, January.
    3. Mohsen Afsharian & Heinz Ahn, 2015. "The overall Malmquist index: a new approach for measuring productivity changes over time," Annals of Operations Research, Springer, vol. 226(1), pages 1-27, March.
    4. Cruz-Cázares, Claudio & Bayona-Sáez, Cristina & García-Marco, Teresa, 2013. "You can’t manage right what you can’t measure well: Technological innovation efficiency," Research Policy, Elsevier, vol. 42(6), pages 1239-1250.
    5. Mohsen Afsharian & Heinz Ahn, 2017. "Multi-period productivity measurement under centralized management with an empirical illustration to German saving banks," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 39(3), pages 881-911, July.
    6. Barnabé Walheer, 2022. "Global Malmquist and cost Malmquist indexes for group comparison," Journal of Productivity Analysis, Springer, vol. 58(1), pages 75-93, August.
    7. Puertas, Rosa & Marti, Luisa & Guaita-Martinez, José M., 2020. "Innovation, lifestyle, policy and socioeconomic factors: An analysis of European quality of life," Technological Forecasting and Social Change, Elsevier, vol. 160(C).

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