Trade Policies and Productivity in Malawi's Manufacturing Sector

Developing countries' economic policies and performance have been associated with different episodes of trade regimes aimed at improving their economic performance through the policies' effects on manufacturing and agriculture which are envisaged to be the engines of growth. However, in Malawi these policies are believed to have led to a continuous decline in the performance of the manufacturing sector due to the country's decline in manufacturing output. With technical efficiency being an important source of output growth, the book tries to assess the impact of trade policies on the performance of the manufacturing sector depicting a developing country experience in Africa. Stochastic frontier analysis (SFA) is applied to estimate efficiency of the manufacturing industries. The book also investigates to what extent trade policies have affected the firms' survival, entry into and exit out of the manufacturing sector. SFA also decomposes total productivity into technical change, technical efficiency change and scale economies effect, to identify the sources of growth. Its empirical application makes it easier even for those new to the field to grasp some of the productivity concepts