Relative efficiencies of organized industries in India, 1949–58

The study attempts to measure relative efficiencies (or inefficiencies) of manufacturing industries in India. Production analysis based on Cobb‐Douglas production function with explicit allowance for technological change is used for the study. Technological change is measured by alternative variables such as technological change embodied in new capital goods (measured by ‘Investment'). ‘Education’ is measured by the ratio of non‐workers to workers. ‘Experience’ is measured by output per worker cumulated over past seven years. Stepwise regression is used to estimate production functions. Consistent data for Indian industries is available for twenty‐eight industries over the ten year period (1949–58). To measure technological change over the ten year period, analysis of covariance is used. Empirical analysis shows that large differences do exist in the efficiency of input use in different industries.