Efficiency, leverage and profitability: The case of Greek manufacturing sector

In this article, we analyse manufacturing sector efficiency in Greece over the period 1996-2011. We compute DEA efficiency scores which we combine with a Tobit analysis to see whether efficiency scores play a role in explaining profitability and leverage. The results from 27 sub-sectors show that: 1) leverage has no effect on sectors' performance in terms of technical efficiency; 2) sub-sectors with a high level of technical efficiency enjoy a higher level of profitability. We argue that competitiveness may be an important indication for Greek firms.