This paper uses both parametric and non-parametric approaches to estimate technical efficiency for 2,298 construction firms in Vietnam in the database of the 2002 Economic Census for Enterprises by the General Statistics Office of Vietnam (GSO). It is found that results from both approaches are consistent, and they could help explain the performance efficiency of these firms. Estimates from the non-parametric approach (data envelopment analysis [DEA] model) and the parametric approach (stochastic frontier production function [SFPF] model) indicate that the average pure technical efficiency of these firms was about 60 percent (58.6% and 57.8% for DEA and SFPF, respectively). Models to test the factors influencing efficiency scores in both approaches show relatively similar results that state firms were more efficient than non-state ones, and location in Hanoi and Ho Chi Minh city did have impacts on efficiency scores. However, exploration of the net capital-labor ratio variable show that it did not influence efficiency scores in the DEA model, while it had clear influence in the SFPF model.
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number
968.
Find related papers by JEL classification: C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Semiparametric and Nonparametric Methods L74 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Construction
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Richmond, J, 1974.
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International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 15(2), pages 515-21, June.
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Afriat, Sidney N, 1972.
"Efficiency Estimation of Production Function,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 13(3), pages 568-98, October.
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