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Efficiency, Technological Progress and Regional Comparative Advantage: A Study of Organised Manufacturing Sector in India

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  • Mukherjee, Dipa
  • Majumder, Rajarshi

Abstract

Technological upgradation and increasing capital intensity in organised manufacturing sector in India has been championed on grounds of improving productivity, efficiency, and competitiveness. In a developing economy this is a costly proposition due to capital scarcity, and the effect of technological changes on productivity and efficiency levels have to be estimated before taking such policies. This paper seeks to estimate trends in Factor Productivity, Technological Progress, and Technological Efficiency in this sector and examines their relative importance also. Technical Efficiency is observed to be moderate and further declining in the nineties. Substantial disparity exists among regions and product groups regarding Efficiency, Technical Progress and Efficiency changes. It is found that increasing capital intensity has been associated with falling productivity, efficiency, and technological deceleration in the nineties. Wider diffusion rather than greater capital use is thus recommended for productivity rise. Regional efficiency matrix is also prepared so that states can focus on specific areas where they have comparative advantages.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 12758.

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Date of creation: 2008
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Handle: RePEc:pra:mprapa:12758

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Related research

Keywords: Productivity; Technical Efficiency; Technological Progress; Organised Manufacturing; Diffusion; Regional Comparative Advantage;

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  1. Bauer, Paul W., 1990. "Recent developments in the econometric estimation of frontiers," Journal of Econometrics, Elsevier, vol. 46(1-2), pages 39-56.
  2. repec:ind:iegddp:28 is not listed on IDEAS
  3. K.P. Kalirajan & M.B. Obwona & S. Zhao, 1996. "A Decomposition of Total Factor Productivity Growth: The Case of Chinese Agricultural Growth before and after Reforms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 331-338.
  4. Bulent Unel, 2003. "Productivity Trends in India's Manufacturing Sectors in the Last Two Decades," IMF Working Papers 03/22, International Monetary Fund.
  5. Uma Kambhampati, 2003. "Trade Reforms and the Efficiency of Firms in India," Oxford Development Studies, Taylor & Francis Journals, vol. 31(2), pages 219-233.
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Cited by:
  1. Vudayagi Balasubramanyam & N Forsans, 2013. "Why do Indian firms go abroad?," Working Papers 33867210, Lancaster University Management School, Economics Department.

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