Efficiency and productivity of the cement industry: Pakistani experience of deregulation and privatisation

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Abstract

This study evaluates the impact of privatisation on efficiency and productivity of the Pakistani cement industry. To address some of the serious concerns about the problem of dimension and outlier, we use a newly developed unconditional hyperbolic α-quantile estimator of Wheelock and Wilson to estimate efficiency (Wheelock D. C., and Wilson P. W., 2008, Non-parametric, unconditional quantile estimation for efficiency analysis with an application to Federal Reserve check processing operations, Journal of Econometrics, 209-225). Subsequently, we use these efficiency estimates to calculate the Malmquist productivity growth and its components. The results show that deregulation and privatisation had the desired positive effect on productivity growth due to technological progress. We conclude that this improvement in the post reform period could be linked to political stability, improved economic conditions and a competitive industry.
Original languageEnglish
Pages (from-to)101-114
JournalOmega
Volume54
Early online date3 Feb 2015
DOIs
Publication statusPublished - Jul 2015

Keywords

  • efficiency
  • Malmquist productivity
  • Pakistani cement industry
  • reform
  • privatisation
  • hyperbolic α-quantile estimator
  • technological progress

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