A study of growth structure and productivity of selected manufacturing industries in Haryana and Punjab state

Abstract

The present attempt has been devoted to measure the level, growth behaviour and status of inclusivity of technical efficiency and malmquist productivity based total factor productivity of manufacturing sector of two of the selected states of Indian Union. For the purpose, data envelopment analysis is applied in the 11 broad industrial groups of the organized manufacturing sector with the help of pooled data of 27 years starting from 1981-82 to 2007-08. Both the states have various common features including demographic composition, contribution of nation pool in terms of agriculture production particularly rice and wheat, socio economic indicators, etc. However, while measuring growth and performance of the two states in terms of structure, level of development, efficiency and productivity of manufacturing sector it is interesting to experience that there are only a few aspects on which the states share common platform. In terms of labour productivity, capital productivity and employment generation state of Haryana is performing better. Whereas when issues of the level of technical efficiency are being raised the state of Punjab is good enough. As against this Punjab robust technical progress is seen in most of the industries. Inter- industry differences are also seen within the states and also across the states in terms of productivity and efficiency. The findings of the study depicts that the level of capital deepening in the manufacturing sector of the two states is registering reverse relationship with labour productivity. These results signify the importance of labour inputs in the production process and need attention of the policy makers to rationalize the level of capital deepening or capital-labour ratio of the manufacturing sector the two regional economies. The study has estimated six specific production functions for the panel form data of different categories of manufacturing sector of the two states.