Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach
This paper aims to analyze the level of technical efficiency and determinants of technical inefficiency of transport manufacturing firms in Malaysia using Stochastic Frontier Analysis (SFA) approach from 2005 to 2010. Through SFA approach, hypothesis test is conducted in order to select Cobb-Douglas...
| Main Authors: | , , , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Penerbit Universiti Kebangsaan Malaysia
2021
|
| Online Access: | http://journalarticle.ukm.my/17598/ http://journalarticle.ukm.my/17598/1/25.pdf |
| _version_ | 1848814353529176064 |
|---|---|
| author | Ammar Fikree Mohamed Jofree, Norayati Hashim, Mohd Fahmy-Abdullah, Lai, Wei Sieng Sulhi Ridzuan, |
| author_facet | Ammar Fikree Mohamed Jofree, Norayati Hashim, Mohd Fahmy-Abdullah, Lai, Wei Sieng Sulhi Ridzuan, |
| author_sort | Ammar Fikree Mohamed Jofree, |
| building | UKM Institutional Repository |
| collection | Online Access |
| description | This paper aims to analyze the level of technical efficiency and determinants of technical inefficiency of transport manufacturing firms in Malaysia using Stochastic Frontier Analysis (SFA) approach from 2005 to 2010. Through SFA approach, hypothesis test is conducted in order to select Cobb-Douglas or Translog production function and testing the effects of technical inefficiencies. While the determining factors that been taken into account include the capital-labor ratio, training expenses, education level ratio, wage rate, information and communication technology expenditure, and firm size. Hypothesis test results show that the Cobb-Douglas production function is rejected. While the test for the effect of technical inefficiency shows its existence. Training expenses, secondary and tertiary education level ratios, wage rates and information and communication technology expenses are significant determinants for transportation manufacturing firms. However, the capital-labor ratio was found that it has reduced the level of technical efficiency. The implications of these results show that firms need to focus on investing in human capital, information technology and increase motivation among employees such as rising wage rates and reducing the use of capital appropriate to the technology. |
| first_indexed | 2025-11-15T00:32:44Z |
| format | Article |
| id | oai:generic.eprints.org:17598 |
| institution | Universiti Kebangasaan Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T00:32:44Z |
| publishDate | 2021 |
| publisher | Penerbit Universiti Kebangsaan Malaysia |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | oai:generic.eprints.org:175982021-11-19T02:50:23Z http://journalarticle.ukm.my/17598/ Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach Ammar Fikree Mohamed Jofree, Norayati Hashim, Mohd Fahmy-Abdullah, Lai, Wei Sieng Sulhi Ridzuan, This paper aims to analyze the level of technical efficiency and determinants of technical inefficiency of transport manufacturing firms in Malaysia using Stochastic Frontier Analysis (SFA) approach from 2005 to 2010. Through SFA approach, hypothesis test is conducted in order to select Cobb-Douglas or Translog production function and testing the effects of technical inefficiencies. While the determining factors that been taken into account include the capital-labor ratio, training expenses, education level ratio, wage rate, information and communication technology expenditure, and firm size. Hypothesis test results show that the Cobb-Douglas production function is rejected. While the test for the effect of technical inefficiency shows its existence. Training expenses, secondary and tertiary education level ratios, wage rates and information and communication technology expenses are significant determinants for transportation manufacturing firms. However, the capital-labor ratio was found that it has reduced the level of technical efficiency. The implications of these results show that firms need to focus on investing in human capital, information technology and increase motivation among employees such as rising wage rates and reducing the use of capital appropriate to the technology. Penerbit Universiti Kebangsaan Malaysia 2021-08 Article PeerReviewed application/pdf en http://journalarticle.ukm.my/17598/1/25.pdf Ammar Fikree Mohamed Jofree, and Norayati Hashim, and Mohd Fahmy-Abdullah, and Lai, Wei Sieng and Sulhi Ridzuan, (2021) Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach. Sains Malaysiana, 50 (8). pp. 2445-2453. ISSN 0126-6039 https://www.ukm.my/jsm/malay_journals/jilid50bil8_2021/KandunganJilid50Bil8_2021.html |
| spellingShingle | Ammar Fikree Mohamed Jofree, Norayati Hashim, Mohd Fahmy-Abdullah, Lai, Wei Sieng Sulhi Ridzuan, Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach |
| title | Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach |
| title_full | Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach |
| title_fullStr | Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach |
| title_full_unstemmed | Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach |
| title_short | Efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach |
| title_sort | efficiency assessment of transport manufacturing firms using a stochastic frontier analysis approach |
| url | http://journalarticle.ukm.my/17598/ http://journalarticle.ukm.my/17598/ http://journalarticle.ukm.my/17598/1/25.pdf |