Prospects from Efficiency Analysis of Exporting and Non-Exporting Pakistani Firms

In the wake of global competition with greater economic and regional integration, a country's economic growth is largely determined by industrial efficiency. Operating and staying within market under cut throat competition appears as an unprecedented challenge for exporting and non-exporting firms. A data of 403 firms from World Bank Enterprise Survey 2013 is used for estimation of technical and scale efficiencies between and within exporting and non-exporting firms. Data Envelopment Analysis (DEA) is applied for constant returns to scale (CRS) and variable returns to scale (VRS) efficiency scores. It has been found that the average technical efficiency scores for non-exporting firms is slightly greater than the exporting firms. But majority of the firm's technical efficiency remained the same for both type of firms. Industries with highest technical efficiency comprise of chemicals, food, garments and non-metals. Efficiency scores of some firms depict interesting results and found efficient in either of exporting and non-exporting firms. The efficiency analysis can help to identify potential changes which industry may require for its consistent growth in current surge of global competition and nationalization.