Technical efficiency of the Ethiopian grain mill products manufacturing industry

Abstract

This study focuses on the estimation of technical efficiency of firms and the identification of the determinants of technical efficiency in the Ethiopian grain mill products manufacturing industry. A stochastic frontier production function model was estimated and the results indicate that technical efficiency levels of firms differ profoundly. Firm size and existence of book of accounts were positively related to the technical efficiency level of firms whereas higher number of products and byproducts was found to have an adverse impact on firms' technical efficiency level. It was also found that publicly owned enterprises are less technically efficient than privately owned ones.

This study focuses on the estimation of technical efficiency of firms and the identification of the determinants of technical efficiency in the Ethiopian grain mill products manufacturing industry. A stochastic frontier production function model was estimated and the results indicate that technical efficiency levels of firms differ profoundly. Firm size and existence of book of accounts were positively related to the technical efficiency level of firms whereas higher number of products and byproducts was found to have an adverse impact on firms' technical efficiency level. It was also found that publicly owned enterprises are less technically efficient than privately owned ones.