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Ownership, autonomy, incentives and efficiency: Evidence from the forest product processing industry in China

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  • He, Haoran
  • Weng, Qian

Abstract

Using enterprise-level data from China's Northeast-Inner Mongolia state-owned forest area for the year 2004, this paper investigates the technical efficiency of forest product processing mills and the relationship between institutional and managerial practices and efficiency. A two-stage procedure proposed by Simar and Wilson (2007) is adopted. In the first stage, a bootstrapped data envelopment analysis (DEA) model is used to compute the efficiency scores. In the second stage, the bootstrapped DEA scores are estimated over a set of mills’ institutional and managerial systems and other characteristics with a bootstrapped truncated regression. The results show that there is a wide dispersion in the technical efficiency among mills. Private ownership, autonomy and mill size have statistically significant positive impacts on efficiency. These results provide support for the ongoing reform and implications for future development of this area.

Suggested Citation

  • He, Haoran & Weng, Qian, 2012. "Ownership, autonomy, incentives and efficiency: Evidence from the forest product processing industry in China," Journal of Forest Economics, Elsevier, vol. 18(3), pages 177-193.
  • Handle: RePEc:eee:foreco:v:18:y:2012:i:3:p:177-193
    DOI: 10.1016/j.jfe.2012.02.001
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    References listed on IDEAS

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    1. repec:eee:foreco:v:28:y:2017:i:c:p:87-95 is not listed on IDEAS
    2. repec:eee:forpol:v:80:y:2017:i:c:p:125-132 is not listed on IDEAS

    More about this item

    Keywords

    Forest product processing mills; Data envelopment analysis; Truncated regression; Bootstrap; China;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L73 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Forest Products
    • L78 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Government Policy

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