Journal of Management Research

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Cost Efficiency of Listed Electronics- Information Firms in China


Affiliations
1 Institute of Industrial Economics Nankai University, China
2 Institute of Business and Management National Chiao Tung University, Taiwan, Province of China
     

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This research studies twenty listed electronics-information firms in China during the period 2001 to 2005 and applies Battese and Coellis (1995) model of a stochastic frontier function to compute the cost inefficiency scores. Simultaneously it also evaluates the influence on cost efficiency of R&D expenditure, scale and management model of the firms. All nominal variables in monetary units have been deflated into real variables at 2001 prices. Our empirical results are summarized as follows: The average cost efficiency of Chinese listed electronics-information firms is very low. R&D expenditure significantly improves cost efficiency. The scale of a firm significantly worsens cost efficiency, showing dis-economies of scale. Operational diversification significantly improves cost efficiency, showing economies of scope.

Keywords

Electronics-information, Cost Efficiency, Operational Diversification
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  • Cost Efficiency of Listed Electronics- Information Firms in China

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Authors

Bai Xue-Jie
Institute of Industrial Economics Nankai University, China
Hu Jin-Li
Institute of Industrial Economics Nankai University, China
Liu Wen-Ling
Institute of Business and Management National Chiao Tung University, Taiwan, Province of China

Abstract


This research studies twenty listed electronics-information firms in China during the period 2001 to 2005 and applies Battese and Coellis (1995) model of a stochastic frontier function to compute the cost inefficiency scores. Simultaneously it also evaluates the influence on cost efficiency of R&D expenditure, scale and management model of the firms. All nominal variables in monetary units have been deflated into real variables at 2001 prices. Our empirical results are summarized as follows: The average cost efficiency of Chinese listed electronics-information firms is very low. R&D expenditure significantly improves cost efficiency. The scale of a firm significantly worsens cost efficiency, showing dis-economies of scale. Operational diversification significantly improves cost efficiency, showing economies of scope.

Keywords


Electronics-information, Cost Efficiency, Operational Diversification

References