Evaluation of Technical Efficiency in Iranian Manufacturing Sector

The main purpose of this research is to measure technical efficiency of Iranian manufacturing sector by Stochastic Frontier Approach (SFA). For this porpoise، the performance of 130 different industrial groups، at The International Standard Industrial Classification (ISIC) was analyzed and discussed during 1996-2007. The results of the study showed that average technical efficiencies of different manufacturing groups were 0. 55. The largest score in efficiency was found for copper metals Manufacturing and refined petroleum products Manufacturing with 0. 83 and 0. 78، and the lowes scores in efficiency was registed for brick production manufacturing and grain mill products Manufacturing with 0. 21 and 0. 23، respectively. Average of technical efficiency is laid in range of 0. 50 to 0/60. In addition، the output inefficiencies are directly related to energy intensity and inversely to the size of firms، while government ownership does not affect the level of inefficiency.