IDEAS home Printed from
   My bibliography  Save this paper

Productivity Growth and Efficiency Change in Malaysian Manufacturing: Recent Evidence from Disaggregated Data



This paper estimates productivity growth in Malaysian manufacturing over the period 1983-1999. Malmquist productivity Indices (MPIs) have been computed using non parametric Data Envelopment Analysis (DEA) type linear programming, which show productivity growth sourced from efficiency change and growth in technology. Unlike previous studies, this study identifies the sources of productivity growth in Malaysian manufacturing industries at the five digit breakdown of Malaysian Standard Industrial Classification (MSIC) thereby revealing more industry specific efficiency and technical growth patterns. Results indicated that a high majority of the industries operated with low levels of technical efficiency with little or no improvement over time. Growth estimates revealed that two third of the industries (76 out of total 114 categories) experienced average annual productivity improvement ranging from 0.1% to 7.8%. Average annual technical progress was recorded by 95 industry categories while technical efficiency improvement was achieved by 53 industries. Overall yearly average indicated relatively low productivity growth from the mid 1990’s onwards caused by either efficiency decline or technical regress. Summary results for industries showed that some of the high rates of productivity growth have been recorded in glass and glass products (7.3%), Petroleum and coal (7.2%), industrial chemicals (4.9%) contributed from both efficiency improvement and technical progress ranging from 0.8% to 5.4% and from 1.7% to 4.1%, respectively. These results are expected to have some implications for ongoing and future strategic policy reform in Malaysian manufacturing generating a more sustainable growth for specific industry categories.

Suggested Citation

  • I.K.M. Mokhtarul Wadud, 2007. "Productivity Growth and Efficiency Change in Malaysian Manufacturing: Recent Evidence from Disaggregated Data," Economics Series 2007_12, Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance.
  • Handle: RePEc:dkn:econwp:eco_2007_12

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Susan Chun Zhu, 2004. "Trade, product cycles, and inequality within and between countries," Canadian Journal of Economics, Canadian Economics Association, vol. 37(4), pages 1042-1060, November.
    2. Rudiger Dornbusch & Stanley Fischer & Paul A. Samuelson, 1980. "Heckscher-Ohlin Trade Theory with a Continuum of Goods," The Quarterly Journal of Economics, Oxford University Press, vol. 95(2), pages 203-224.
    3. Peter K. Schott, 2008. "The relative sophistication of Chinese exports," Economic Policy, CEPR;CES;MSH, vol. 23, pages 5-49, January.
    4. Peter K. Schott, 2004. "Across-Product Versus Within-Product Specialization in International Trade," The Quarterly Journal of Economics, Oxford University Press, vol. 119(2), pages 647-678.
    5. Zhu, Susan Chun & Trefler, Daniel, 2005. "Trade and inequality in developing countries: a general equilibrium analysis," Journal of International Economics, Elsevier, vol. 65(1), pages 21-48, January.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Oluremi Ogun, 2015. "A Fundamental-based Approach to Productivity Growth," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 43(3), pages 383-392, September.

    More about this item


    Manufacturing; Productivity growth; Technical efficiency change;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D20 - Microeconomics - - Production and Organizations - - - General
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:dkn:econwp:eco_2007_12. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dr Xueli Tang). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.