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ISO 9000 certification and technical efficiency of foreign‐financed manufacturing firms in southern China

Author

Listed:
  • Godfrey Yeung
  • Vincent Mok

Abstract

Purpose - Based on a sample of foreign‐financed manufacturing firms in southern China, the purpose of this paper is to study the effects of ISO certification on productivity. Design/methodology/approach - The paper employs the stochastic frontier approach to estimate frontier efficiency scores at firm level. Findings - The empirical results suggest that the implementation of ISO was able to improve firms' productivity in the form of a wholly disembodied shift of the production frontier. The results further show that there was a mildly positive embodied shift of the production frontier due to the effects of ISO on the marginal product of labor. However, the embodied effects of ISO on the marginal product of capital were not significant. Research limitations/implications - The sample size is small and the data were collected from southern China. A generalization of results to other parts of China should be interpreted with caution. Despite the limited degree of generalization, firms with ISO certifications are suggested to be aware of certain flexibility in the implementation of the ISO documented procedures. Practical implications - The findings of the paper should be of general interest to firms seeking or adopting ISO system or other international standards. Originality/value - The originality of the paper resides in the fact that the empirical work investigates the embodied effects of ISO certification on the marginal product of labor and capital.

Suggested Citation

  • Godfrey Yeung & Vincent Mok, 2008. "ISO 9000 certification and technical efficiency of foreign‐financed manufacturing firms in southern China," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 35(5), pages 385-404, September.
  • Handle: RePEc:eme:jespps:v:35:y:2008:i:5:p:385-404
    DOI: 10.1108/01443580810903545
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    Citations

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    Cited by:

    1. Mareike Heimeshoff & Jonas Schreyögg & Lukas Kwietniewski, 2014. "Cost and technical efficiency of physician practices: a stochastic frontier approach using panel data," Health Care Management Science, Springer, vol. 17(2), pages 150-161, June.
    2. Raimundo Soto & Rosalía Vásquez, 2011. "The Efficiency Cost of the Kafala in Dubai: A Stochastic Frontier Analysis," Documentos de Trabajo 399, Instituto de Economia. Pontificia Universidad Católica de Chile..
    3. Song, Yang & Yeung, Godfrey & Zhu, Daolin & Zhang, Lixin & Xu, Yang & Zhang, Lanyue, 2020. "Efficiency of logistics land use: The case of Yangtze River Economic Belt in China, 2000–2017," Journal of Transport Geography, Elsevier, vol. 88(C).

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