TITLE:
Impact of Economic Liberalization on Technical Efficiency of Firms: Evidence from India’s Electronics Industry
AUTHORS:
Dipayan Datta Chaudhuri
KEYWORDS:
Technical Efficiency, Technical Progress, Translog Stochastic Frontier Production Function
JOURNAL NAME:
Theoretical Economics Letters,
Vol.6 No.3,
June
15,
2016
ABSTRACT: The purpose of the paper is to analyze the impact of economic
liberalization on technical progress and technical efficiency of electronics
hardware manufacturing firms in India. In this study, Translog stochastic
frontier production function is estimated in order to measure technical progress
and technical efficiency of firms in an era of economic liberalization. The
results indicate that electronics hardware manufacturing firms in India have
experienced a significant improvement in technical progress during 2002-2010
but the average level of technical efficiency of firms has declined during the
same period. The study therefore, concludes that a number of firms have failed
to appropriate the benefits of technical progress in India’s electronics
industry. It has also been observed that implementation of the Information
Technology Agreement (ITA) of World Trade Organization (WTO) does not have any
significant impact on technical efficiency of firms operating in the
electronics industry.