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Economic Reforms and Technical Efficiency Performance in Indian Manufacturing Sector

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  • Sivakumar, P.
  • Patnaik, K. Uma Shankar

Abstract

This paper estimate and examine the technical efficiencies of Indian manufacturing sector covering 144 three-digit industries for the period of 1973-74 to 1997-98. The main aim of this study is to capture the behavior of technical efficiencies during the pre and post reforms periods. By employing time-varying stochastic frontier production function in the transcendental logarithmic form, this analysis identifies that there is a decreasing trend in the technical efficiency level across industries and across time periods1 . The main finding of this study is that the industry specific inefficiency effects are the main factor affecting the production process in achieving maximum feasible output than the other random factors such as weather, luck, strikes etc. Also, this paper identifies that during the post reforms period, technical efficiency is much lower than that of pre-reform periods.

Suggested Citation

  • Sivakumar, P. & Patnaik, K. Uma Shankar, 2005. "Economic Reforms and Technical Efficiency Performance in Indian Manufacturing Sector," Conference papers 331420, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:331420
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