An assessment of operational efficiency of retail firms in China

Abstract

This study aims to assess operational efficiency of retail firms in China. Economic efficiencies of 61 retailers working in China between 2000 and 2003 are examined in this study using three related methodologies: data envelopment analysis (DEA), Malmquist productivity index (MPI), and a bootstrapped Tobit regression model. DEA analysis shows that only seven retail firms are considered as efficient under CRS assumption in 2002, and four firms in 2003. MPI results indicate that about 37.7 percent (23 out of 61) of retail firms have registered progress in terms of MPI during 2000 and 2003. Results of the bootstrapped Tobit analysis show that retail characteristic plays a significant role influencing retail efficiency.