IDEAS home Printed from https://ideas.repec.org/a/ula/econom/v37y2012i34p121-137.html
   My bibliography  Save this article

Patterns of technical efficiency in the Venezuelan manufacturing sector (2007)

Author

Listed:
  • José Contreras

    (Investigador Senior. Oficina de Investigaciones Económicas. Banco Central de Venezuela. Avenida. Urdaneta esquina Las Carmelitas, Caracas 1010-Venezuela. Dirección Postal: Apartado 2017, Carmelitas Caracas 1010-Venezuela.)

  • Andrés Santeliz

    (Investigador Invitado. Oficina de Investigaciones Económicas. Banco Central de Venezuela. Avenida. Urdaneta esquina Las Carmelitas Caracas 1010-Venezuela Dirección Postal: Apartado 2017, Carmelitas Caracas 1010-Venezuela.)

  • Oscar Carvallo

    (Investigador Senior. Oficina de Investigaciones Económicas. Banco Central de Venezuela. Avenida. Urdaneta esquina Las Carmelitas Caracas 1010-Venezuela Dirección Postal: Apartado 2017, Carmelitas Caracas 1010-Venezuela.)

Abstract

As a component of a research project aimed at characterizing the Venezuelan industry, this paper is a contribution to the evaluation of technical efficiency and its determinants for the manufacturing sector. With this purpose in mind we use the concept of X-inefficiency. For the evaluation, we estimated a stochastic production function and performed several tests for various efficiency determinants. The data source was the PRACEM manufacturing survey for 2007 from the Central Bank of Venezuela. We found that firm size and liquidity of assets were positively correlated with efficiency. The most efficient sectors are associated with the industrial base created during the “import substitution” period: agro industry and textile and paper industries.

Suggested Citation

  • José Contreras & Andrés Santeliz & Oscar Carvallo, 2012. "Patterns of technical efficiency in the Venezuelan manufacturing sector (2007)," Economía, Instituto de Investigaciones Económicas y Sociales (IIES). Facultad de Ciencias Económicas y Sociales. Universidad de Los Andes. Mérida, Venezuela, vol. 37(34), pages 121-137, july-dece.
    • Handle: RePEc:ula:econom:v:37:y:2012:i:34:p:121-137
    as

    Download full text from publisher

    File URL: ftp://iies.faces.ula.ve/Pdf/Revista34/Rev34Contreras.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hung T. Pham & Thanh L. Dao & Barry Reilly, 2010. "Technical efficiency in the Vietnamese manufacturing sector," Journal of International Development, John Wiley & Sons, Ltd., vol. 22(4), pages 503-520.
    2. ALVARO ANGERIZ & JOHN McCOMBIE & MARK ROBERTS, 2006. "Productivity, Efficiency And Technological Change In European Union Regional Manufacturing: A Data Envelopment Analysis Approach," Manchester School, University of Manchester, vol. 74(4), pages 500-525, July.
    3. Imraan Valodia & Myriam Velia, 2006. "Macro--Micro Linkages in Trade: Trade, Efficiency and Competitiveness of Manufacturing Firms in Durban, South Africa," Journal of African Economies, Centre for the Study of African Economies, vol. 15(4), pages 688-721, December.
    4. Faruq Hasan A & Yi David T., 2010. "The Determinants of Technical Efficiency of Manufacturing Firms in Ghana," Global Economy Journal, De Gruyter, vol. 10(3), pages 1-23, October.
    5. MA Hossain & ND Karunaratne, 2004. "Trade Liberalisation and Technical Efficiency: Evidence from Bangladesh Manufacturing Industries," Journal of Development Studies, Taylor & Francis Journals, vol. 40(3), pages 87-114.
    6. Nigel L. Driffield & Uma S. Kambhampati, 2003. "Trade Liberalization and the Efficiency of Firms in Indian Manufacturing," Review of Development Economics, Wiley Blackwell, vol. 7(3), pages 419-430, August.
    7. Meeusen, Wim & van den Broeck, Julien, 1977. "Efficiency Estimation from Cobb-Douglas Production Functions with Composed Error," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(2), pages 435-444, June.
    8. Almas Heshmati, 2003. "Productivity Growth, Efficiency and Outsourcing in Manufacturing and Service Industries," Journal of Economic Surveys, Wiley Blackwell, vol. 17(1), pages 79-112, February.
    9. Mats GRANÉR & Anders ISAKSSON, 2009. "Firm Efficiency And The Destination Of Exports: Evidence From Kenyan Plant‐Level Data," The Developing Economies, Institute of Developing Economies, vol. 47(3), pages 279-306, September.
    10. Frauke G. Braun & Astrid Cullmann, 2011. "Regional Differences of Production and Efficiency of Mexican Manufacturing: An Application of Nested and Stochastic Frontier Panel Models," Journal of Developing Areas, Tennessee State University, College of Business, vol. 45(1), pages 291-311, July-Dece.
    11. Metin KARADAG, 2010. "The Impact of Public Capital on the Efficiency of Private Manufacturing Industry at the Regional Level," Ege Academic Review, Ege University Faculty of Economics and Administrative Sciences, vol. 10(4), pages 1167-1174.
    12. George E. Battese & Greg S. Corra, 1977. "Estimation Of A Production Frontier Model: With Application To The Pastoral Zone Of Eastern Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 21(3), pages 169-179, December.
    13. Akihiro Otsuka & Mika Goto & Toshiyuki Sueyoshi, 2010. "Industrial agglomeration effects in Japan: Productive efficiency, market access, and public fiscal transfer," Papers in Regional Science, Wiley Blackwell, vol. 89(4), pages 819-840, November.
    14. Alvarez, Roberto & Crespi, Gustavo, 2003. "Determinants of Technical Efficiency in Small Firms," Small Business Economics, Springer, vol. 20(3), pages 233-244, May.
    15. Taegi Kim & Changsuh Park, 2006. "Productivity growth in Korea: efficiency improvement or technical progress?," Applied Economics, Taylor & Francis Journals, vol. 38(8), pages 943-954.
    16. Battese, George E. & Corra, Greg S., 1977. "Estimation Of A Production Frontier Model: With Application To The Pastoral Zone Of Eastern Australia," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 21(3), pages 1-11, December.
    17. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-332.
    18. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
    19. Karine Chapelle & Patrick Plane, 2005. "Technical efficiency measurement within the manufacturing sector in Cote d'Ivoire: A stochastic frontier approach," Journal of Development Studies, Taylor & Francis Journals, vol. 41(7), pages 1303-1324.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rajesh Raj S.N., 2011. "Technical Efficiency in the Informal Manufacturing Sector," Journal of South Asian Development, , vol. 6(2), pages 213-232, October.
    2. Musleh-ud Din & Ejaz Ghani & Tariq Mahmood, 2007. "Technical Efficiency of Pakistan s Manufacturing Sector: A Stochastic Frontier and Data Envelopment Analysis," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 46(1), pages 1-18.
    3. Tom Kompas & Tuong Nhu Che & R. Quentin Grafton, 2004. "Technical efficiency effects of input controls: evidence from Australia's banana prawn fishery," Applied Economics, Taylor & Francis Journals, vol. 36(15), pages 1631-1641.
    4. Williams, Jonathan, 2004. "Determining management behaviour in European banking," Journal of Banking & Finance, Elsevier, vol. 28(10), pages 2427-2460, October.
    5. Roy, Manish & Mazumder, Ritwik, 2016. "Technical Efficiency of Fish Catch in Traditional Fishing: A Study in Southern Assam," Journal of Regional Development and Planning, Rajarshi Majumder, vol. 5(1), pages 55-68.
    6. Edward Ebo ONUMAH & Bernhard BRÜMMER & Gabriele HÖRSTGEN-SCHWARK, 2010. "Productivity of the hired and family labour and determinants of technical inefficiency in Ghana's fish farms," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 56(2), pages 79-88.
    7. repec:use:tkiwps:3232 is not listed on IDEAS
    8. Roberto Furesi & Fabio Madau & Pietro Pulina, 2013. "Technical efficiency in the sheep dairy industry: an application on the Sardinian (Italy) sector," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 1(1), pages 1-11, December.
    9. Srinivasulu Rajendran, 2014. "Technical Efficiency of Fruit and Vegetable Producers in Tamil Nadu, India: A Stochastic Frontier Approach," Asian Journal of Agriculture and Development, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), vol. 11(1), pages 77-93, June.
    10. Tauer, Loren W. & Mishra, Ashok K., 2006. "Can the small dairy farm remain competitive in US agriculture?," Food Policy, Elsevier, vol. 31(5), pages 458-468, October.
    11. Boyle, G.E. & McQuinn, K., 2003. "Why do some countries produce so much more output per worker than others? A note," Economics Department Working Paper Series n1331103, Department of Economics, National University of Ireland - Maynooth.
    12. Sabrina Auci & Donatella Vignani, 2020. "Climate variability and agriculture in Italy: a stochastic frontier analysis at the regional level," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 37(2), pages 381-409, July.
    13. Tom Kompas, 2004. "Market reform, productivity and efficiency in Vietnamese rice production," International and Development Economics Working Papers idec04-4, International and Development Economics.
    14. Thi Bich Tran & R. Quentin Grafton & Tom Kompas, 2008. "Firm Efficiency in a Transitional Economy: Evidence from Vietnam," Asian Economic Journal, East Asian Economic Association, vol. 22(1), pages 47-66, March.
    15. Nuno Ferreira & Francisca Mendonça Souza & Adriano Mendonça Souza, 2014. "PSI-20 Portfolio Efficiency Analysis with SFA," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 4(3), pages 785-785.
    16. Tariq Mahmood & Ejaz Ghani & Musleh-Ud Din, 2006. "Efficiency of Large-scale Manufacturing in Pakistan: A Production Frontier Approach," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 45(4), pages 689-700.
    17. Bavorova, Miroslava & Curtiss, Jarmila & Jelinek, Ladislav, 2005. "Czech Agricultural Associations and the Impact of Membership on Farm Efficiency," 94th Seminar, April 9-10, 2005, Ashford, UK 24430, European Association of Agricultural Economists.
    18. Seog-Chan Oh & Alfred J. Hildreth, 2014. "Estimating the Technical Improvement of Energy Efficiency in the Automotive Industry—Stochastic and Deterministic Frontier Benchmarking Approaches," Energies, MDPI, vol. 7(9), pages 1-27, September.
    19. Kuo-Liang Matt Chang & Todd A. Lone, 2009. "The Efficiency of Labor Input in the Tree Nut Growers Industry: A Stochastic Frontier Production Approach Study in Butte County, California," SDSU Working Papers in Progress 42009, South Dakota State University, Department of Economics.
    20. Alejandro Esteller-Moré, 2005. "Is There a Connection Between the Tax Administration and the Political Power?," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(5), pages 639-663, September.
    21. Ali, M.K., 2018. "Estimation of irrigation water use efficiency with a stochastic frontier model," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277354, International Association of Agricultural Economists.

    More about this item

    Keywords

    Technical efficiency; manufacture; functions of production; stochastic border.;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ula:econom:v:37:y:2012:i:34:p:121-137. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Alexis Vásquez (email available below). General contact details of provider: https://edirc.repec.org/data/iiulave.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.