Inefficiency Effects Research Articles

How Does Tax Avoidance Affect a Firm's Investment Inefficiency in Taiwan's Semiconductor Industry?

ABSTRACTThis study examines an important issue regarding how tax avoidance affects a firm's investment inefficiency in Taiwan's semiconductor industry. In addition, the dynamic effect of a firm's investment inefficiency and spillover effect of investment inefficiency from competitors are also explored. This study adopts 44 listed firms from 2013 to 2021 and constructs the “competitor‐dependence matrix” to replace the “spatial‐dependence matrix” in the dynamic spatial autoregressive model. According to the difference generalized method of moments estimation, the primary finding of this study is that the tax avoidance has a statistically and significantly positive effect on a firm's investment inefficiency while it is overinvestment, but a negative effect while it is underinvestment. Moreover, the dynamic effect is statistically insignificant, but the spillover effect is statistically and significantly negative.

The inefficient effects of non-clinical factors on health care costs.

We use Benford's law to examine the non-random elements of health care costs. We find that as health care expenditures increase, the conformity to the expected distribution of naturally occurring numbers worsens, indicating a tendency towards inefficient treatment. Government insurers follow Benford's law better than private insurers indicating more efficient treatment. Surprisingly, self-insured patients suffer the most from non-clinical cost factors. We suggest that cost saving efforts to reduce non-clinical expenses should be focused on more severe, costly encounters. Doing so focuses cost reduction efforts on less than 10% of encounters that constitute over 70% of dollars spent on health care treatment.

Investigation of an irradiated CCD device: Building and testing a Charge Transfer Inefficiency correction pipeline using the Pyxel framework

Pyxel is a powerful end-to-end detector simulations framework with the aim of being reusable, reliable and help facilitate knowledge transfer between a wide range of related fields. To show how beneficial Pyxel can be, we present an investigation into the effect of Charge Transfer Inefficiency (CTI) on an irradiated CCD-273 device produced by Teledyne-e2v, the type of detector used for the Euclid VIS instrument. This requires production of two pipelines. Firstly, a calibration pipeline to search the parameter space and obtain best fitting trap parameters based upon the CTI within the detector. Secondly, a correction pipeline which aims to correct the CTI-induced data using these trap parameters to obtain a nominal efficiency of 99.5%. The following presents work conducted in building, testing and validating the correction pipeline using Pyxel and the CTI model ArCTIC. This involves data from the unirradiated portion of a CCD-273 device using the scene projection system at the labs at the European Space Agency (ESA). The images are computationally altered by varying parameters such as background levels and readout noise, and by synthetically producing CTI trails from known trap parameters. The resulting images are corrected and analysed to understand how noise affects the correction efficiency at varying image background levels.

Elementary education outcome efficiency of Indian state governments: a generalized stochastic frontier approach

PurposeThis paper aims to analyze the technical efficiency of Indian State governments in providing elementary education (EE) and to identify the determinants of their technical inefficiency.Design/methodology/approachThe Generalized Stochastic Frontier Approach (GSFA) is used in the context of the Inefficiency Effects Model to simultaneously estimate the frontier production function and the technical inefficiency model. Panel data of 28 Indian States from 2009–10 to 2018–19 is used.FindingsThe mean efficiency of States stands at 86%. Efficiency varied between 67 and 97%. 96% of the inter-state disparity in EE outcomes can be explained by inefficiency. Arunachal Pradesh is the least efficient State, followed by Sikkim and Tripura. Efficiency estimates were observed to change across States over the study period. Proportion of government schools, rural population, and proportion of Schedule Caste and Schedule Tribe children are the major determinants of inefficiency.Practical implicationsThis study emphasizes that efficient resource management is as important as adequate resource allocation for achieving positive EE outcomes. It distinguishes resource-poor States from inefficient ones, providing insights to enhance States’ efficiency, and aiding policymakers in formulating strategies for ensuring equitable and quality EE.Originality/valueThis is the first paper to apply GSFA (for Indian States), providing a more robust estimation of efficiency. The Inefficiency Effects Model is employed that address the limitations inherent in the two-stage approach.

Kenya’s macroeconomic policies and trade efficiency within the East African Community: A stochastic frontier analysis

Despite Kenya dominating trade volumes in the East African Community (EAC), it has been trading below its potential within the region. This is also in spite of the increased scope of the country’s trade opportunities resulting from the region’s increased market integration. Empirical evidence has shown that macroeconomic policies influence international trade flows. However, there is limited empirical evidence on the effect of macroeconomic policies on trade efficiency. The few existing studies on this topic have also used estimation techniques that depict efficiency as being drawn from an average level of trade and not the optimal level of trade, as well as also not separating the effects of inefficiencies from the statistical noises. This, therefore, creates a knowledge gap that this study aims at investigating by using the stochastic frontier gravity model (SFGM), to determine the effect of Kenya’s macroeconomic policies on its trade efficiency within the EAC. The study used annual panel secondary data for the period 2000 to 2021. This study finds that the GDP of Kenya and that of its EAC trading partners, the geographical distance and border significantly affects trade volume. It also finds that globalization plays a significant role in influencing Kenya’s trade. For the inefficiency model variables, exchange rate depreciation was found to significantly increase trade efficiency, while increase in tariff rate had an adverse and significant effect. Further, the study included corruption as a control variable and found that it significantly increases trade inefficiency. Kenya, though trading at an average efficiency level of 86.91 percent, was found to have high unexploited trade potentials within the region especially with Tanzania and Uganda. The study recommends that Kenya’s policymakers deliberately advance the macroeconomic policies that promote trade efficiency while at the same time closely monitor the ones that hinder efficiency.

Frontier model of the environmental inefficiency effects on livestock bioeconomy.

This work was focused on measuring environmental inefficiency in Mexican dairy farms, considering climate change variables related to the emission of greenhouse gases (GHG) and planetary geomagnetic activity. The applied methodology measures the eco-efficiency of Mexican dairy farms using the empirical application of a stochastic frontier model of the bioeconomy. The productive sector of the bioeconomy studied was the eco-intensification of the livestock production system (dairies). The environmental inefficiency effect was assumed to be a distribution-independent truncation of a normal distribution with constant variance, while the mean was a linear environmental function of the observable variable. The results showed that the coefficients of the frontier model were highly significant, highlighting the investment in livestock (50%). The inefficiency model had an impact on climate variation with greenhouse gas emissions CH4 (1.96%). The results of the environmental technical efficiency in geometric average were 81.28%. The producers that reached the border with a technical efficiency equal to 1 are the references for the rest, marking the relative technical efficiency. It was concluded that the coefficients in the model were very significant, showing the level of investment in livestock (50%). The low-performance model estimates the impact of climate change on GHG emissions CH4 (1.96%) explaining the trend of increasing GHG emissions, keeping in view that the management of food and cattle during the study period were affected by summer feeding, which allowed considering the activity of GHG emissions. According to the results, the geometric mean environmental performance of engineering is 81.28%.

Interstate Disparity in Combating COVID-19 in India: Efficiency Estimate Across States

Currently, COVID-19 is the most lethal menace in the world. Due to its health and economic consequences, it becomes a serious challenge for the economy. The present article aims to explore India’s interstate disparities of efficiency in combating COVID-19 based on secondary data. Besides, an attempt has been made to pinpoint the factors responsible for the inefficiency of resisting this deadly virus. The interstate efficiency measurement is facilitated by applying stochastic production frontier analysis. The empirical result divulges that among the Indian states, Bihar is the most efficient in combating COVID-19. The empirical estimation of the frontier model discloses that the number of doctors, nurses, police force, isolation beds and hotspots positively and significantly influence the recovery rate from COVID-19 in Indian states. The empirical results of the inefficiency effects model suggest that the share of elderly and urbanisation reversely influence the efficiency in combating the virus, while favourable sex ratio, literacy rate, regular salaried employment, digitalisation and ruralisation stimulate the efficiency of the concerned state. The study concludes that efficient utilisation, coupled with the advancement of the existing health infrastructure, is imperative for the acceleration of the recovery rate from this pandemic.

Toward green production practices: empirical evidence from Thai manufacturers' technical efficiency

PurposeThe development of green manufacturing has become essential to achieve sustainable development and modernize the nation’s manufacturing and production capacity without increasing nonrenewable resource consumption and pollution. This study investigates the effect of green industrial practices on technical efficiency for Thai manufacturers.Design/methodology/approachThe study uses stochastic frontier analysis (SFA) to estimate the stochastic frontier production function (SFPF) and inefficiency effects model, as pioneered by Battese and Coelli (1995).FindingsThis study shows that, on average, Thai manufacturing firms have experienced declining returns-to-scale production and relatively low technical efficiency. However, it is estimated that Thai manufacturing firms with a green commitment obtained the highest technical efficiency, followed by those with green activity, green systems and green culture levels, compared to those without any commitment to green manufacturing practices. Finally, internationalization and skill development can significantly improve technical efficiency.Practical implicationsGreen industry policy mixes will be vital for driving structural reforms toward a more environmentally friendly and sustainable economic system. Furthermore, circular economy processes can promote firms' production efficiency and resource use.Originality/valueTo the best of the authors' knowledge, this study is the first to investigate the effect of green industry practices on the technical efficiency of Thai manufacturing enterprises. This study also encompasses analyses of the roles of internationalization, innovation and skill development.

Southern Ocean Biological Pump Role in Driving Holocene Atmospheric CO2: Reappraisal

AbstractChanges in Southern Ocean biological pump efficiency are frequently invoked as a source of glacial/interglacial CO2 variability. It was recently suggested that Southern Ocean biological pump weakening also contributed to Holocene CO2 increase. Here we test the causes and downstream effects of biological pump inefficiency during the Holocene. We first provide evidence that a southward shift of the South Westerly Winds, was likely the cause of increasing upwelling in the Southern Ocean leading to local biological pump weakening as reflected in fossil‐bound δ15N. We then introduce a series of ultra‐high resolution (6 m/ky) productivity records from the Chilean Margin to determine the fate of Southern Ocean nutrients. A compilation of records from Pacific sites supports export and complete consumption of preformed Southern Ocean nutrients, which might have reduced the contributions of Southern Ocean marine source to the Holocene increase in atmospheric CO2.

Technical Efficiency of Handloom-based Micro-enterprises in Assam, India: A Stochastic Frontier Analysis

Improving technical efficiency is one of the most effective ways to boost output in any manufacturing process. The efficiency level of enterprises can be improved by identifying their sources of inefficiency. The present article examines the technical efficiency and tries to identify the factors causing technical inefficiency in handloom-based micro-enterprises in Assam. The article used primary data and collected from 312 micro-level handloom enterprises spread across four districts of Assam. The stochastic frontier production with an inefficiency effects model is used for the purpose of analysis. Labour, capital and material inputs are found to be significant and labour is the most effective factor for increasing of output level. The mean technical efficiency of overall enterprises is 0.67 and a wide variation in the level of technical efficiency among the sample handloom enterprises is observed. Inefficiency model shows that a high yarn capital ratio, lower product diversity, entrepreneurs with training, a higher number of employees and adoption of promotional practices tend to reduce the technical inefficiency of the handloom enterprise significantly.

Differential cross-section measurements of the production of four charged leptons in association with two jets using the ATLAS detector

Differential cross-sections are measured for the production of four charged leptons in association with two jets. These measurements are sensitive to final states in which the jets are produced via the strong interaction as well as to the purely-electroweak vector boson scattering process. The analysis is performed using proton-proton collision data collected by ATLAS at sqrt{s} = 13 TeV and with an integrated luminosity of 140 fb−1. The data are corrected for the effects of detector inefficiency and resolution and are compared to state-of-the-art Monte Carlo event generator predictions. The differential cross-sections are used to search for anomalous weak-boson self-interactions that are induced by dimension-six and dimension-eight operators in Standard Model effective field theory.

A Qualitative Study of Work Motivation Among the Media and Creative Workers in Malaysia

The creative industry is a booming sector in the contribution to the gross domestic product in a country especially towards the gig economy. Among the pillars within the creative industry is those from the film and drama sectors. Terms such as above-the-line and below-the-line are segregated to identify their nature of work and how it contributes to the audio-visual industry. Therefore, the creative industry practitioners are facing challenges in maintaining their status quo for better economic gains and protecting their well-fare due to the nature of the creative industries as freelancers. This study’s objective is to understand the problems that are faced by the creative industry stakeholders in generating their income and also to study the possible effects of inefficiency of well-fare protection in Malaysia's creative industry. This study also uses qualitative study and thematic analysis to analyse the data gained from focus group discussion of five (5) participants where four (4) of them are creative creators and one (1) of them was from the legislative office of copyright protection in Malaysia. The interviews were recorded into audio files and transcribed verbatim. The data acquired were later on analysed using ATLAS.ti and have managed to discover three (3) emergent themes that reflects the whole purpose of the study. The impact of this study is to understand what could possibly be done to improvise the economic and welfare well-being of the creative industry practitioners.

Technical efficiency and its determinants in regulating adolescents’ coronavirus infection across Asian countries

The coronavirus pandemic, besides generating health distress, influences the socio-economic conditions of humankind. Every adolescent's lifestyle is affected by the virus. Healthy adolescents are not only key contributors to the forthcoming workforce but also a source of a country’s human capital. The purpose of the article is to examine the efficacy of various Asian countries in regulating the spread of the coronavirus among adolescents. In addition to that, the paper also attempts to pinpoint the prime causes of the inefficiency of a country in regulating the same. The paper also examines the behavioural changes among adolescents across Asian countries in pre-and-post pandemic times. In this context, the study identifies the impact of adolescents’ tobacco consumption, female political leadership, and accreditation on a country’s efficacy to regulate adolescents’ coronavirus infection. The study’s empirical analysis covers twenty-one Asian countries. By using the Panel Stochastic Production Frontier, the study concludes that Kazakhstan is the most efficient country and Afghanistan is the least efficient country on the list. The inefficiency effects estimates conclude that adolescents’ tobacco consumption decreases and good governance practices increase the efficiency of a country in regulating the spread of adolescent coronavirus infection. Additionally, the paper finds no significant behavioural changes among adolescents in pre-and-post pandemic times across Asian countries. The paper concludes with appropriate policy recommendations supported by empirical evidence. The paper also identifies its shortcomings and suggests potential future lines of inquiry.

Technical efficiency of early variety country bean cultivation in selected areas of Bangladesh: a stochastic frontier approach

The present study was undertaken to measure the profitability and technical efficiency of early variety country bean cultivation in selected areas of Chatmohar upazila of Pabna district. A total of 60 early variety country bean-growing farmers were selected from three villages of Chatmohar upazila using a simple random sampling technique. Stochastic frontier production function was applied to determine the technical efficiency of the country bean growers. Technical inefficiency effects model was also applied to identify the demographic and socio-economic factors by which inefficiency effects are influenced. The study revealed that Benefit Cost Ratio (BCR) was the highest (2.29) for large farmers followed by medium (2.27) and small farmers (2.21). The result of the Maximum Likelihood Estimates (MLE) showed that human labor, fencing and manure had significant positive impact whereas the irrigation and insecticides had a negative impact on the production of country bean. The results of technical inefficiency effect model showed that farmer’s age, farm size had negative impact while education, family size and farm credit had positive impact on technical efficiency. The inefficiency analysis results indicated that farm level technical efficiency ranged between 43.06% and 98.01% with a mean technical efficiency of 91.9% implied that there was potential to increase country bean production among smallholder farmers in the study area by 8.1% through efficient use of present technology. The main constraints to country bean (early variety) production were identified as- infestation of pest and disease, high price of inputs, paucity of quality seed and fertilizer, scarcity of human labor, lack of technical knowledge, limited access to institutional credit etc. Despite the constraints, there is a great prospect of early variety country bean production in the study areas. Country bean (early variety) production could be increased in a sustainable manner if farmers would be provided with government support regarding lower price of input, fair price of output, marketing facilities, training for farmers and farm credit at low interest rate, reducing the activities of syndicate of middlemen. Government should provide necessary support to the farmers for ensuring sustainable production of early varieties of country bean. Res. Agric. Livest. Fish. Vol. 10, No. 2, August 2023: 155-164

Measuring and decomposing profit efficiency changes of water utilities: a case study for Chile

ABSTRACT Estimating profit inefficiency and its drivers is highly relevant for water utilities and water regulators to reduce water tariffs. We employed a novel methodological approach to compute profit inefficiency and changes to profit efficiency based on the Luenberger productivity indicator. This empirical application focused on the water industry in Chile from 2010 to 2018. Estimated average profit inefficiency was 43.6%, with the main contributor being allocative inefficiency (35.7%). In contrast, the effect of technical inefficiency was more limited (7.9%). Changes to profit efficiency differed among full private and concessionary utilities, with averages of 0.021 and 0.002, respectively.

The Effect of Investment Inefficiency on Expected Returns

The majority of Indian firms have a promoter and family-owner-dominated ownership structure; therefore, the agency problem prevailing in such a setting would be the conflict of interest between the majority and minority shareholders. This motivated us to examine the adverse effect of not investing at the level implied by the firms’ characteristics, termed investment inefficiency, on the ex-ante measure of expected returns, the implied cost of capital. Our study finds a positive relationship between investment inefficiency and expected returns in the baseline results estimated using pooled ordinary least squares (OLS) and the robustness results estimated using a two-step generalized method of moments (GMM). The sample of the study consists of listed firms in India from 2016 to 2021. JEL Codes: G11, G31

Textile Industry Efficiency in Eastern European Countries

Abstract In the global world where competition is increasing constantly, efficient use of resources is becoming more important for the textile industry. In this study, the efficiency scores and inefficiency effects of the textile industry in selected Eastern European countries were investigated using stochastic frontier analysis. The results indicate that age has a negative impact on inefficiency in the Czech Republic and Hungary. The current ratio decreases the inefficiency in Slovakia, Poland and Hungary, while time decreases that in Slovakia, the Czech Republic and Hungary.

Resource Use Efficiency and Cleaner Agricultural Production: An Application of Technical Inefficiency Effects Model for Paddy Producing Zones of West Bengal

It is possible to enhancement of agricultural productivity with environmental sustainability through efficient utilization of resources. This hypothesis is examined by the efficiency and the responsible factors for controlling inefficiency of the farms. The empirical analyses are conducted based on the secondary data of 14 960 farms scattered into five different paddy producing zones of West Bengal, India. The Efficiency estimates disclose that clayey soil texture zone is the most efficient and sandy and gravelly soil texture zone is the least efficient concerning paddy production. The study concludes with appropriate policy implications that the inefficiency on the part of the farms is caused by inefficient utilization of the chemical fertilizers, viz., nitrogen and potassium and insecticides and by the efficient utilization of this the farm can increase its productivity with environmental sustainability.

Determinant Analysis Of Credit Distribution In Regional Development Bank In Indonesia

This study uses the cross-section of time series data from 2011-2020 and Regional Development Banks in Indonesia. The method used in this study is the panel data regression method with the Fixed Effect GLS approach. Econometric analysis using panel data regression models to identify the variables that affect lending. This study aims to analyze the effect of Capital, Profitability, Bank Health, and Inefficiency on lending at Regional Development Banks. The analysis results show that simultaneously the independent variables significantly affect the dependent variable. Furthermore, partial Return On Assets positively and substantially affects lending at Regional Development Banks in Indonesia.

Frontier model of the environmental inefficiency effects on livestock bioeconomy

Background: This work was focused on measuring environmental inefficiency in Mexican dairy farms, considering climate change variables related to the emission of greenhouse gases (GHG) and planetary geomagnetic activity. Methods: The applied methodology measures the eco-efficiency of Mexican dairy farms using the empirical application of a stochastic frontier model of the bioeconomy. The productive sector of the bioeconomy studied was the eco-intensification of the livestock production system (dairies). The environmental inefficiency effect was assumed to be a distribution-independent truncation of a normal distribution with constant variance, while the mean was a linear environmental function of the observable variable. Results: The results showed that the coefficients of the frontier model were highly significant, highlighting the investment in livestock (50%). The inefficiency model had an impact on climate variation with greenhouse gas emissions CH4 (1.96%). The results of the environmental technical efficiency in geometric average were 81.28%. The producers that reached the border with a technical efficiency equal to 1 are the references for the rest, marking the relative technical efficiency. Conclusions: It was concluded that the coefficients in the model were very significant, showing the level of investment in livestock (50%). The low-performance model estimates the impact of climate change on GHG emissions CH4 (1.96%) explaining the trend of increasing GHG emissions, keeping in view that the management of food and cattle during the study period were affected by summer feeding, which allowed considering the activity of GHG emissions. According to the results, the geometric mean environmental performance of engineering is 81.28%.