Productivity growth in India's bakery manufacturing industry
Journal of Agribusiness in Developing and Emerging Economies
ISSN: 2044-0839
Article publication date: 9 October 2020
Issue publication date: 1 February 2022
Abstract
Purpose
The main aim of this paper is to examine the total factor productivity (TFP) and its components namely, technological change, technical efficiency change, scale change and allocative change in bakery industry in India.
Design/methodology/approach
The study is based on panel data on 35 Indian states for the period 2009–2010 and 2012–2013. Stochastic frontier function is employed to estimate the productivity growth.
Findings
The results show that TFP is driven by technological progress, followed by technical efficiency and scale efficiency. Allocative efficiency, however, has a negative effect on TFP.
Research limitations/implications
The bakery industry needs to define its innovation strategies, as these strategies lead to different outcomes that can be achieved only through the management of resources dedicated to the generation and implementation of innovations.
Originality/value
Using frontier production function takes the stochastic context into account for the dynamic behaviour of TFP and its components. Most of the past studies have assessed the TFP at the aggregate level using three-digit National Industrial Classification (NIC) or four-digit NIC code. An analysis at higher levels aggregation masks the variation in TFP and its components available at the firm level. This study uses five-digit NIC data to measure the firm specific TFP of bakery industry. Further, it looks at the contribution of technical progress (TP), technical efficiency, scale efficiency and allocative efficiency.
Keywords
Citation
Kumar, S., Abdulla and Singh, C. (2022), "Productivity growth in India's bakery manufacturing industry", Journal of Agribusiness in Developing and Emerging Economies, Vol. 12 No. 1, pp. 94-103. https://doi.org/10.1108/JADEE-12-2019-0204
Publisher
:Emerald Publishing Limited
Copyright © 2020, Emerald Publishing Limited