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Ownership, autonomy, incentives and efficiency: Evidence from the forest product processing industry in China

Journal article
Authors H. R. He
Qian Weng
Published in Journal of Forest Economics
Volume 18
Issue 3
Pages 177-193
ISSN 1104-6899
Publication year 2012
Published at Department of Economics
Pages 177-193
Language en
Keywords Forest product processing mills, Data envelopment analysis, Truncated regression, Bootstrap, China, nonparametric frontier models, data envelopment analysis, primary wood, producers, state enterprises, technical efficiency, sawmill industry, british-columbia, performance, privatization, methodology, arnes a, 1978, european journal of operational research, v2, p429, restiere, v38, p2553, restiere, v35, p285
Subject categories Forest economics


Using enterprise-level data from China's Northeast-Inner Mongolia state-owned forest area for the year 2004, this paper investigates the technical efficiency of forest product processing mills and the relationship between institutional and managerial practices and efficiency. A two-stage procedure proposed by Simar and Wilson (2007) is adopted. In the first stage, a bootstrapped data envelopment analysis (DEA) model is used to compute the efficiency scores. In the second stage, the bootstrapped DEA scores are estimated over a set of mills' institutional and managerial systems and other characteristics with a bootstrapped truncated regression. The results show that there is a wide dispersion in the technical efficiency among mills. Private ownership, autonomy and mill size have statistically significant positive impacts on efficiency. These results provide support for the ongoing reform and implications for future development of this area. (C) 2012 Department of Forest Economics, Swedish University of Agricultural Sciences, Umea. Published by Elsevier GmbH. All rights reserved.

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