TECHNICAL EFFICIENCY IN INDIA’S UNORGANISED MANUFACTURING SECTOR: A NON-PARAMETRIC ANALYSIS

Unorganized manufacturing sector accommodates a large portion of workforce who are poor and economically excluded in the developing economies. Indian economy witnessed a rapid economic growth after the adoption of globalization policies in the year 1991. Contribution of unorganized manufacturing sector to the gross domestic product has increased. This sector is generally characterized by low productivity and low efficiency. However increasing importance of this sector makes the efficiency analysis more crucial recently. An attempt has been made in this paper to examine the technical efficiency of India's unorganized manufacturing sector across states. Efficiency levels across different industries/ industry groups are also examined. Data Envelopment Analysis, a non-parametric approach of measuring technical efficiency is used. National Sample Survey Organization (NSSO) data for 1994-95 and 2005-06 have been considered.