Growth of Factor Inputs and Total Factor Productivity in Public Sector Enterprises in India

Abstract

This study makes an attempt to examine the trend in Total Factor Productivity in the public sector enterprises by estimating and analyzing the contributions made by major factor inputs to the growth rate of not product originating in the public enterprises. It is divided into six sectors. After introducing the problem in the first section, the next three sections deal mainly with the estimation and analysis of the required time series of output, capital and labor respectively for public sector enterprises. In the last two sections, the estimates of contributions made by various sources to the growth of public enterprises are presented and some of their implications are examined. The major conclusions of the study are that the overall economic efficiency of the public sector enterprises has increased at the significant rate during the period after 1960-61, and that there seems to have been a remarkable acceleration in the growth rate of total factor productivity in public enterprises during the more recent years.