Journal of Forest Economics > Vol 28 > Issue 1

Stochastic frontier analysis of productive efficiency in China's Forestry Industry

Jiandong Chen, School of Public Finance and Taxation, Southwestern University of Finance and Economics, PR China, Yinyin Wu, School of Public Finance and Taxation, Southwestern University of Finance and Economics, PR China, Malin Song, School of Statistics and Applied Mathematics, Anhui University of Finance and Economics, PR China, songmartin@163.com Zunhong Zhu, School of International Auditing, Nanjing Audit University, PR China,
 
Suggested Citation
Jiandong Chen, Yinyin Wu, Malin Song and Zunhong Zhu (2017), "Stochastic frontier analysis of productive efficiency in China's Forestry Industry", Journal of Forest Economics: Vol. 28: No. 1, pp 87-95. http://dx.doi.org/10.1016/j.jfe.2017.05.005

Published: 0/8/2017
© 0 2017 Jiandong Chen, Yinyin Wu, Malin Song, Zunhong Zhu
 
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Keywords
Forestry industryStochastic frontier analysisOutput distance functionHeterogeneity
 

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In this article:
Introduction
Methods of benchmarking for performance
Methodology and data
Empirical results and discussion
Conclusions and policy implications

Abstract

Forest resources are vital to the development of green economics. Given the booming development of China's forestry industry and its ambitious reforestation efforts in the developing world, this paper is the first to use the output distance function to synthetically consider the economic and ecological outputs of China's forestry industry, and discuss its productive efficiency with a stochastic frontier model. Control and environmental variables are incorporated to capture heterogeneity in China's forestry industry, which helps us get an unbiased estimation. The empirical results show that there was no obvious efficiency disparity among China's economic regions except Northeastern China, and the state-owned forestry structure has a significantly negative effect on productive efficiency in China's forestry industry. Moreover, provinces with poor productive performance in the forestry industry such as Inner-Mongolia, Heilongjiang, and Hebei have been identified and their individual characteristics regarding productive efficiency have also been analyzed. The findings in this paper have targeted and practical implications for the development of China's forest green economy.

DOI:10.1016/j.jfe.2017.05.005