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Efficiency and Productivity of Singapore's Manufacturing Sector 2001-2010: An analysis using Simar and Wilson's (2007) bootstrapped truncated approach

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  • Boon L Lee

    ()
    (QUT)

Abstract

This paper seeks to explain the lagging productivity in Singapore's manufacturing noted in the statements of the Economic Strategies Committee Report 2010. Two methods are employed: the Malmquist productivity to measure total factor productivity change and Simar and Wilson's (J Econ, 136:31–64, 2007) bootstrapped truncated regression approach. In the first stage, the nonparametric data envelopment analysis is used to measure technical efficiency. To quantify the economic drivers underlying inefficiencies, the second stage employs a bootstrapped truncated regression whereby bias-corrected efficiency estimates are regressed against explanatory variables. The findings reveal that growth in total factor productivity was attributed to efficiency change with no technical progress. Most industries were technically inefficient throughout the period except for 'Pharmaceutical Products'. Sources of efficiency were attributed to quality of worker and flexible work arrangements while incessant use of foreign workers lowered efficiency.

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File URL: http://external-apps.qut.edu.au/business/documents/discussionPapers/2012/WP283.pdf
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Bibliographic Info

Paper provided by School of Economics and Finance, Queensland University of Technology in its series School of Economics and Finance Discussion Papers and Working Papers Series with number 283.

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Length: 27 pages
Date of creation: 14 May 2012
Date of revision:
Handle: RePEc:qut:dpaper:283

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Web page: http://www.bus.qut.edu.au/faculty/economics/
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Keywords: Bootstrap truncated regression; technical efficiency; data envelopment analysis; total-factor productivity; efficiency change; technical change; Malmquist productivity index; Singapore manufacturing;

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