Technical and Allocative Efficiency among Socialist Enterprises: The Case of the Garment Industry in China

Using survey data, this paper compares technical and allocative efficiency among state, urban collective, township-village, and joint venture enterprises in the garment industry in China. Township-village enterprises are further classified into independent enterprises and cooperative ventures with state and urban collective enterprises. According to the estimation results of the production and labor share functions, state and urban collective enterprises are much less efficient, both technically and allocatively, than cooperative township-village enterprise and joint ventures. These findings suggest that this new type of socialist enterprise and joint ventures will eventually dominate in the garment industry. J. Comp. Econom. December 1994, 19(3), pp. 410-433. Tokyo Metropolitan University, Hachiohji City, Tokyo 192-03, Japan; Tokyo Gakugei University, Koganei City, Tokyo 184, Japan; and International Food Policy Research Institute, Washington, DC 20036.