This paper measures total factor productivity(TFP) changes of Northeast Asian countries‘ steel industries and decomposes the sources of total factor productivity change into technical change and technical efficiency change by the non-parametric Malmquist productivity index. The results of this study are as follows. First, efficiency scores of Korean and Chinese steel industries are 100%, and those of Taiwanese and Japanese steel industries are 99.1% and 99.1% respectively. Second, annual total factor productivity growth of world steel industries is 1.5% and technical progress do much for TFP increase. Japanese steel industries marked annual increase of 4.5% of total factor productivity, highest among North-east Asian countries', for 1998-2005, while that of Korean steel industry decreased 0.03% annually. Third, technical progress contributed in TFP increase of steel industries in Japan, China and Taiwan. Korean steel industry, however, relatively lagged behind other countries' in technical progress. Finally, it is necessary to note that findings and implications of this study should be viewed as tentative since the measurement of efficiency still has potential sources of bias due to limitations on availability of re quired data. Therefore, there should be more to be done with a variety of data sets and methodologies to fully evaluate the efficiency and competitiveness of steel industries.

This paper measures total factor productivity(TFP) changes of Northeast Asian countries‘ steel industries and decomposes the sources of total factor productivity change into technical change and technical efficiency change by the non-parametric Malmquist productivity index. The results of this study are as follows. First, efficiency scores of Korean and Chinese steel industries are 100%, and those of Taiwanese and Japanese steel industries are 99.1% and 99.1% respectively. Second, annual total factor productivity growth of world steel industries is 1.5% and technical progress do much for TFP increase. Japanese steel industries marked annual increase of 4.5% of total factor productivity, highest among North-east Asian countries', for 1998-2005, while that of Korean steel industry decreased 0.03% annually. Third, technical progress contributed in TFP increase of steel industries in Japan, China and Taiwan. Korean steel industry, however, relatively lagged behind other countries' in technical progress. Finally, it is necessary to note that findings and implications of this study should be viewed as tentative since the measurement of efficiency still has potential sources of bias due to limitations on availability of re quired data. Therefore, there should be more to be done with a variety of data sets and methodologies to fully evaluate the efficiency and competitiveness of steel industries.

Efficiency, Malmquist index, Total factor productivity, DEA.