A comparative study of the relative efficiency and productivity growth of Korea's fixed network and mobile services in relation to 11 OECD countries

Abstract

Thus far, few literatures have ventured to separate the telecommunications industry by technology as a means of analyzing efficiency and productivity growth. This study decomposes the telecommunications industry into fixed network services and mobile services. It examines the relative efficiency and productivity growth of Korea``s fixed network and mobile services in relation to 11 OECD countries from 1996 to 2001. This research uses DEA (Data Envelopment Analysis) and the Malmquist index for analysis of efficiency and productivity growth. The OECD Telecommunications Database 2003 is also used. I adopt as variables one output, revenue and two inputs, access paths and staff. As a result of this study, Korea``s efficiency and productivity growth rate in both services were shown to be relatively low among 11 countries. This study suggests that while fixed network services need to focus strongly on making improvements in pure managerial skills, mobile services need to upgrade their scale efficiency and technical progress.