Evaluating the Productivity of Selected Steel Production Firms in Iran: A Malmquist Approach

The productivity is the most important factor for industrial competiveness. Since the steel industry is resource-based and Iran has required natural resources for the industry, the steel industry has crucial role in the country’s economy. Therefore, this article examine the changes of TFP of four major Iranian steel companies including Khuzestan Steel, Khorasan Steel, Isfahan Steel and Mobarakeh Steel through a Malmquist Index for the period 1389-1393. The results show that TFP changes in the steel companies are deeply affected by the technical changes. The average of TFP annual growth for these companies is totally about 4 percent and their TFP changes trend is affected by the technical changes that confirms the importance of improving technology in the industry. The factors like equipment and machineries updating, link between higher education and industries, and attracting foreign direct investment which improve production technology, can improve the productivity of the steel industry.