| The purpose of this dissertation is to estimate technical efficiencies and its determinants among Indonesian manufacturing firms, banks, as well as provincial economies over the period 1993 to 2000. Stochastic frontier analysis is used to achieve these aims. The technical efficiency of Indonesian manufacturing firms is estimated by using a translog production function. The food, textile, chemical and metal products sectors are on average 50.79%, 47.89%, 68.65% and 68.19% technically efficient, respectively. Ownership contributed to technical inefficiency in food sector; location and size contributed to technical inefficiency in textile sector; size, ownership and age contributed to inefficiencies in chemical, and metal product sectors. Productivity in food, textile, and metal products sectors decreased at the rate of 2.73%, 0.26%, 1.65% and 0.5%, respectively, whereas in the chemical sector, it increased at a rate of 0.5%.;For the Indonesian banks, a fourier-flexible cost function is used to estimate cost efficiency. Overall, the cost efficiency of all banks during the period 1993--2000 was 69.82%. On average the efficiency of banks prior to the Asian crisis and after the Asian crisis were 79.67% and 53.40% respectively. Private-owned banks and joint venture/foreign banks were more efficient than public-owned banks. Large banks tend to be more efficient as compared to smaller banks. Over the period 1993--2000, the total factor productivity growths of Indonesian banks declined by -3.14%. Scale economies existed in public and private banks but not in joint venture/foreign banks. Before the Asian crisis, Indonesian banks productivity decreased by 1.48%, while after the Asian crisis it decreased by 6.45%. Private and public banks are more productive than the joint venture/foreign banks and small Indonesian banks had relatively higher productivity than the larger banks.;The technical efficiency for Indonesian provincial economies for 26 provinces is estimated by using a translog production function. On average, the provincial economies are only 50.6% efficient. Mean years of schooling and sectoral differences have been the main factors contributing to technical inefficiencies. Across provinces, total factor productivity grew, on average, in the range of 1.65% to 5.43%, with an average growth of 3.59%. During the Asian crisis total factor productivity for most of the western provinces decreased more than eastern provinces. |
