Choosing competitive industries in manufacturing of China under low-carbon economy: A Three-stage DEA analysis
International Journal of Climate Change Strategies and Management
ISSN: 1756-8692
Article publication date: 4 November 2013
Abstract
Purpose
This paper aims to explore true technical efficiency in order to select the most competitive manufacturing industries in China. And the paper intends to discuss how environmental variables measured by energy consumption affect performance in different industrial sectors under the restriction of low-carbon economy.
Design/methodology/approach
In order to measure the calculated efficiency of industrial sectors more accurately, Three-stage DEA model is presented in the empirical analysis using data from 2007 to 2010 covering 29 manufacturing industries in China. The advantage of using this method is enabling us to separate the managerial factor from external environmental factors and random errors factors on the technical efficiency.
Findings
The results using this Three-stage DEA model show that textile manufacturing sector has the highest technical efficiency, and when environment variables are not considered, efficiencies in machinery and electronics manufacturing industries have a significant increase. Moreover, this empirical model enables us to evaluate the technical performance in various manufacturing sectors more accurately.
Practical implications
This study provides a useful efficiency measurement tool (Three-stage DEA model) to calculate technical efficiency among different industrial sectors. Technical efficiency plays a key role in building the competitiveness of manufacturing industry. Based on the objective efficiency evaluation, the paper can make a better selection of the most competitive industries.
Originality/value
The paper contributes to the existing literature by developing a Three-stage DEA to examine the technical efficiency and competitive power of manufacturing sectors in China. This study has great policy implications for the research of China's manufacturing in both ideas and methodology.
Keywords
Acknowledgements
This article is supported by the National Natural Science Foundation of China (Grant No. 71201139, 71171001), Program for New Century Excellent Talents in University (Grant No. NCET-12-0595), the Bureau of Statistics of China (Grant No. 2011LD002, 2012LD001) and Fundamental Research Funds for the Central Universities (2010221040). The authors would like to thank the editors and reviewers for their careful review and insightful comments, which have led to significant improvement of the article.
Citation
Fang, K., Hong, X., Li, S., Song, M. and Zhang, J. (2013), "Choosing competitive industries in manufacturing of China under low-carbon economy: A Three-stage DEA analysis", International Journal of Climate Change Strategies and Management, Vol. 5 No. 4, pp. 431-444. https://doi.org/10.1108/IJCCSM-09-2012-0054
Publisher
:Emerald Group Publishing Limited
Copyright © 2013, Emerald Group Publishing Limited