This paper measures the relative efficiencies of individual sugar mills of Uttar Pradesh, India, and sets targets for relatively inefficient mills to improve their performance. The study is based on the cross-sectional data collected for the year 2002-03 from a sample of 36 sugar mills. The Data Envelopment Analysis (DEA) is applied for assessing efficiencies of individual sugar mills. Tobit regression analysis is conducted to examine the impact of various background variables on the efficiencies. The paper finds that about 14% of sugar mills operate at the maximum degree of efficiency under Constant Returns to Scale (CRS) technology assumption. It also evinces that an average sugar mill has the scope of producing the same level of output with the inputs that are 9% lesser than the existing level. The study shows that several sugar mills have been able to make efficient use of their inputs but they suffer from disadvantageous plant sizes. The regression analysis reveals that the net sugar recovery and plant size have a significant positive impact on the overall technical efficiency and scale efficiency. Labor input is found to be highly underutilized in almost all inefficient mills. This calls for an amendment in the labor laws to deal with the issue of overstaffing and to provide scope for the organization to employ young, motivated and talented workforce. The paper suggests that efficiency in the sugar industry may be increased by expanding its capacity as sugar mills in the state are mostly found to operate at increasing returns to scale.
Download Info
To our knowledge, this item is not available for
download. To find whether it is available, there are three
options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page
whether it is in fact available.
3. Perform a search for a similarly titled item that would be
available.
Volume (Year): III (2006) Issue (Month): 3 (August) Pages: 22-38 Download reference. The following formats are available: HTML
(with abstract),
plain text
(with abstract),
BibTeX,
RIS (EndNote, RefMan, ProCite),
ReDIF
Handle: RePEc:icf:icfjie:v:03:y:2006:i:3:p:22-38
Contact details of provider:
For technical questions regarding this item, or to correct its listing, contact: (M Aruna).