Abstract
This paper explores the sales productivity of manufacturing companies in four countries. Specifically, data envelopment analysis (DEA) is used to compare the use of labour and equipment to produce domestic and export sales in the People's Republic of China, Hungary, the USSR (before the break-up of the republic) and the United States. Firms from the machine tool industry were evaluated using data gathered by the Global Manufacturing Research Group. When labour hours and equipment are considered, the United States’ firms are the most efficient at producing sales output and China's firms the least. When labour dollars instead of labour hours are considered, surprisingly, China's firms remain least efficient while those from the USSR and Hungary fare quite well when compared with those from the United States. Several important differences in manufacturing practices help explain the differences in sales productivity and point out areas where care must be taken in creating joint ventures between firms in these countries.
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