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Construction firm’s efficiency in Malaysia

Construction firms in Malaysia have seen a strong growth. It has indicated being a potential as contributor to the nation’s GDP. Records have also indicated that Shariah compliant organization have sustained resilience in various economic challenges. Therefore, this paper examines the technical effi...

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Main Authors: Zahariah Sahudin, Wan Mansor Wan Mahmood, Zaidi Isa, Aminah Shari
Format: Article
Language:English
English
Published: Labuan Faculty of International Finance, Universiti Malaysia Sabah 2015
Subjects:
HD61 Risk in industry. Risk management
Online Access:https://eprints.ums.edu.my/id/eprint/27902/1/Construction%20firm%E2%80%99s%20efficiency%20in%20Malaysia%20ABSTRACT.pdf
https://eprints.ums.edu.my/id/eprint/27902/2/Construction%20firm%E2%80%99s%20efficiency%20in%20Malaysia%20FULL%20TEXT.pdf
https://eprints.ums.edu.my/id/eprint/27902/
https://jurcon.ums.edu.my/ojums/index.php/LJMS/article/view/2985
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spelling my.ums.eprints.279022021-07-08T14:02:35Z https://eprints.ums.edu.my/id/eprint/27902/ Construction firm’s efficiency in Malaysia Zahariah Sahudin Wan Mansor Wan Mahmood Zaidi Isa Aminah Shari HD61 Risk in industry. Risk management Construction firms in Malaysia have seen a strong growth. It has indicated being a potential as contributor to the nation’s GDP. Records have also indicated that Shariah compliant organization have sustained resilience in various economic challenges. Therefore, this paper examines the technical efficiency of Shariah-compliant construction firms in Malaysia for the year between 2002 through 2011. Using Stochastic Frontier Approach (SFA) with one output (profit) and four inputs (labour costs, physical capital, financial capital and current asset) the results indicated that average technical efficiency is 55.59%, an indication of input waste of 44.41%, in terms of labour, financial capital, physical capital and current assets in producing an output. The mean efficiency achieved implies that the Shariah-construction industry is far from realizing 100% of its potential output. The findings are relevant to the ongoing debate on the issue of inefficiency of Shariah-compliant firm in realizing optimal output. The results suggest that in emerging economies like Malaysia, full efficiency will generate industrial growth which in turn will contribute to the nation economic growth. Labuan Faculty of International Finance, Universiti Malaysia Sabah 2015 Article PeerReviewed text en https://eprints.ums.edu.my/id/eprint/27902/1/Construction%20firm%E2%80%99s%20efficiency%20in%20Malaysia%20ABSTRACT.pdf text en https://eprints.ums.edu.my/id/eprint/27902/2/Construction%20firm%E2%80%99s%20efficiency%20in%20Malaysia%20FULL%20TEXT.pdf Zahariah Sahudin and Wan Mansor Wan Mahmood and Zaidi Isa and Aminah Shari (2015) Construction firm’s efficiency in Malaysia. Labuan e-Journal of Muamalat and Society, 9. pp. 26-35. ISSN 2672-7390 https://jurcon.ums.edu.my/ojums/index.php/LJMS/article/view/2985
institution Universiti Malaysia Sabah
building UMS Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Malaysia Sabah
content_source UMS Institutional Repository
url_provider http://eprints.ums.edu.my/
language English
English
topic HD61 Risk in industry. Risk management
spellingShingle HD61 Risk in industry. Risk management
Zahariah Sahudin
Wan Mansor Wan Mahmood
Zaidi Isa
Aminah Shari
Construction firm’s efficiency in Malaysia
description Construction firms in Malaysia have seen a strong growth. It has indicated being a potential as contributor to the nation’s GDP. Records have also indicated that Shariah compliant organization have sustained resilience in various economic challenges. Therefore, this paper examines the technical efficiency of Shariah-compliant construction firms in Malaysia for the year between 2002 through 2011. Using Stochastic Frontier Approach (SFA) with one output (profit) and four inputs (labour costs, physical capital, financial capital and current asset) the results indicated that average technical efficiency is 55.59%, an indication of input waste of 44.41%, in terms of labour, financial capital, physical capital and current assets in producing an output. The mean efficiency achieved implies that the Shariah-construction industry is far from realizing 100% of its potential output. The findings are relevant to the ongoing debate on the issue of inefficiency of Shariah-compliant firm in realizing optimal output. The results suggest that in emerging economies like Malaysia, full efficiency will generate industrial growth which in turn will contribute to the nation economic growth.
format Article
author Zahariah Sahudin
Wan Mansor Wan Mahmood
Zaidi Isa
Aminah Shari
author_facet Zahariah Sahudin
Wan Mansor Wan Mahmood
Zaidi Isa
Aminah Shari
author_sort Zahariah Sahudin
title Construction firm’s efficiency in Malaysia
title_short Construction firm’s efficiency in Malaysia
title_full Construction firm’s efficiency in Malaysia
title_fullStr Construction firm’s efficiency in Malaysia
title_full_unstemmed Construction firm’s efficiency in Malaysia
title_sort construction firm’s efficiency in malaysia
publisher Labuan Faculty of International Finance, Universiti Malaysia Sabah
publishDate 2015
url https://eprints.ums.edu.my/id/eprint/27902/1/Construction%20firm%E2%80%99s%20efficiency%20in%20Malaysia%20ABSTRACT.pdf
https://eprints.ums.edu.my/id/eprint/27902/2/Construction%20firm%E2%80%99s%20efficiency%20in%20Malaysia%20FULL%20TEXT.pdf
https://eprints.ums.edu.my/id/eprint/27902/
https://jurcon.ums.edu.my/ojums/index.php/LJMS/article/view/2985
_version_ 1760230649415860224
score 13.211869

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