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Productivity and efficiency analysis of Pakistani mutual funds using Malmquist index approach

Author

Listed:
  • Farah Naz

    (Department of Accounting & Finance, Kinnaird College for Women, Lahore, Pakistan)

  • Hafsa Khan

    (Department of Business Studies, Kinnaird College for Women, Lahore, Pakistan)

  • Muhammad Ishfaq Ahmad

    (Lahore Business School, The University of Lahore, Pakistan)

  • Ramiz Ur Rehman

    (Lahore Business School, The University of Lahore, Pakistan)

  • Muhammad Akram Naseem

    (Lahore Business School, The University of Lahore, Pakistan)

Abstract

The key area of this research is to analyze the total factor productivity of mutual funds by using Data Envelopment Analysis (DEA) and also to identify the components which play a significant role in the growth of productivity. Malmquist productivity index approach is a nonparametric method that decomposes the index into components of productivity. The process of decomposition also helps in identifying the contribution of technology and efficiency in the growth of mutual funds in Pakistan. Empirical results suggest that efficiency growth in mutual funds is presenting the upward trend. The individual results of mutual funds showed the divergent trend. The component of pure efficiency change has a great influence on productivity growth except for all others components, and technical change has a smaller number of contributions in productivity growth.

Suggested Citation

  • Farah Naz & Hafsa Khan & Muhammad Ishfaq Ahmad & Ramiz Ur Rehman & Muhammad Akram Naseem, 2019. "Productivity and efficiency analysis of Pakistani mutual funds using Malmquist index approach," International Journal of Financial Engineering (IJFE), World Scientific Publishing Co. Pte. Ltd., vol. 6(03), pages 1-21, September.
    • Handle: RePEc:wsi:ijfexx:v:06:y:2019:i:03:n:s2424786319500269
    DOI: 10.1142/S2424786319500269
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    References listed on IDEAS

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