Investigating Technical Efficiency and Its Determinants by Data Envelopment Analysis : An Application in the Greek Food and Beverages Manufacturing Industry

In this paper, a two-step procedure is applied in order to investigate technical efficiency and its determinants in the Greek food and beverages manufacturing industry for the period 1984-2007. Technical efficiency scores for the industry are estimated using the DEA approach. Moreover, bootstrapped truncated regressions and OLS regressions are applied in order to investigate the factors affecting technical efficiency. The empirical results indicate that there is a fluctuation of technical efficiency scores among the sectors of the food and beverages industry. Furthermore, the findings obtained from both the Tobit and the OLS regressions support that the factors affecting positively the level of technical efficiency are sector size, capital productivity, labor productivity and labor intensity. The results also show that the technical efficiency of the whole industry tended to decrease during the period 1984-2007. Moreover, the present paper provides some policy recommendations that may be useful for the industry to overcome the present economic crisis. Finally, in future research, the technical efficiency of the Greek food industry will be analyzed based on the meta-analysis approach