TY - JOUR
T1 - The determinants of firms' performance
T2 - can finance constraints improve technical efficiency?
AU - Sena, Vania
PY - 2006/7/1
Y1 - 2006/7/1
N2 - This paper analyses the mechanisms through which binding finance constraints can induce debt-constrained firms to improve technical efficiency to guarantee positive profits. This hypothesis is tested on a sample of firms belonging to the Italian manufacturing. Technical efficiency scores are computed by estimating parametric production frontiers using the one stage approach as in Battese and Coelli [Battese, G., Coelli, T., 1995. A model for technical efficiency effects in a stochastic frontier production function for panel data. Empirical Economics 20, 325-332]. The results support the hypothesis that a restriction in the availability of financial resources can affect positively efficiency. © 2004 Elsevier B.V. All rights reserved.
AB - This paper analyses the mechanisms through which binding finance constraints can induce debt-constrained firms to improve technical efficiency to guarantee positive profits. This hypothesis is tested on a sample of firms belonging to the Italian manufacturing. Technical efficiency scores are computed by estimating parametric production frontiers using the one stage approach as in Battese and Coelli [Battese, G., Coelli, T., 1995. A model for technical efficiency effects in a stochastic frontier production function for panel data. Empirical Economics 20, 325-332]. The results support the hypothesis that a restriction in the availability of financial resources can affect positively efficiency. © 2004 Elsevier B.V. All rights reserved.
KW - finance constraints
KW - productivity and competitiveness
KW - technical efficiency
UR - http://www.scopus.com/inward/record.url?scp=32544440933&partnerID=8YFLogxK
UR - https://www.sciencedirect.com/science/article/pii/S0377221704006265?via%3Dihub
U2 - 10.1016/j.ejor.2004.07.071
DO - 10.1016/j.ejor.2004.07.071
M3 - Article
SN - 0377-2217
VL - 172
SP - 311
EP - 325
JO - European Journal of Operational Research
JF - European Journal of Operational Research
IS - 1
ER -