CHAPTER 1

INTRODUCTION
1.1 Demand for Labour

Demand for skilled labour is much necessary to raise human resource with every step
towards modernization and industrialization of manufacturing units. Yet another benefit of such
changes leads to high demand commercially. The educated human resource can overcome the
problem of unavailability of capital because these two resources are essential for huge production
and if one is missing the other one can fill its need. With the appearance of globalization, there is
the trend to investment from developed to developing countries because labour is cheap in
developing countries. So if developing countries have skilled labour, they can compete in
international markets and raise demand for their skilled labour (Conner and Lunati, 1999 ; Mayer,
2000).
Skill improvement can be explained as a route of sharpening abilities to perform different
tasks linked with their current and upcoming challenges (Tripathi, 2003).Moreover, study suggests
that human capacity can be polished via advanced education and training (Haq, 2003).
Enhanced skills make human to be more useful in productive view and earn more money. It not
only increase the outcome from investment and employability but also suggest the execution of
development projects timely (Booth and Snower, 1996) and (Conner and Lunati, 1999).
For further elaboration, vocational education and training are essential instruments which lead to
growth in labour mobility, flexibility and efficiency, so contributing to attractive firms’
competitiveness and adjustment labour market imbalances (Caillods, 1994).

1.2 Overview Labour Force in Pakistan

In developing countries like Pakistan, there is abundant of labour force available. Pakistan
is labour intensive country. A large number of persons is waiting to get their jobs according to their
capability. Only availability of labour force is not necessary but it also must be skilled. Technical
education and vocational training authority (TEVTA) is a government institution that’s working for
improving labour skills (Mustafa, 2005).

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 From the previous 65 years, Pakistan’s population has shift from 33 millionto 194.42
million in 2015-16 and the population growth rate is 2.07 % per annum. Pakistan has this benefit
edge that large number of workers available for work. After few decades there might be a huge
arrival of people in the functioning age group (about 200 million people). This movement can be
easily seen from the last decades, the population of functioning age scenario has grown. As the
labour force moved from 41.38 million in 2001 to 65.36 million in 2014. Labour force
Participations rate (Crude Activity Rate (CAR) is 32.3 percent (15.8 % of females 48.1 % of
males). This all indicators are showing that Pakistan can utilize this opportunity by making them
skills, education and better training (GOP, 2015-16).

1.3 Overview TEVTA in Pakistan

TEVTA was formed after the ordinance passed by the Governor of Punjab in 1999. Now
this ordinance is replaced by Punjab as TEVTA ACT in 2010. The main objective of TEVTA is to
make skilled labour force. TEVTA is improving and managing the vocational, commercial and
technical education which leads to develop in industry, agriculture and commerce. The mission of
TEVTA to boost the current condition of Pakistan economy, especially in Punjab. It's creating
productive, self-motivative and incorporated technical education for unskilled labour.
TEVTA in Pakistan can be divided into three subcomponents: prevocational or school level known
as TEVTA, higher engineering, and technology education. The history of the introduction and
integration of prevocational and vocational courses into the general school education dates back to
the early 1950s and many experiments have been conducted. However, these efforts have not had a
significant impact on general school education, which from the period of colonial rule was geared
toward producing clerks and other office workers rather than technicians, engineers, and scientists.
The education policy of 1972–80 suggested a major shift from general education and emphasised
relating education to the world of work. This resulted in the introduction of agro-technical studies
(wood work, metal work, and electricity), agriculture, and home economics in urban, rural, and
girls’ middle schools respectively in grades 6–8. In grades 9–10 introduction of vocational courses
of various groups such as agriculture, commerce, home economics, and industrial arts was
encouraged. More recently, this approach is reaffirmed under the National Education Policy and
Education Sector Reform Programme.

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Pakistan is a developing country with higher population growth and the youth (15-24 years old)
population appeared to be the major portion of the population. With the fast growing youth
population, the TVETA’s sector capacity for delivering demand-driven training services for
increasing workforce with technical and professional skills remain insufficient to meet the modern
labour market challenges (Shah, 2004; Janjua and Irfan, 2008). Moreover, the Labour Force
Participation (LFP) rate in Pakistan is relatively low (only 44%) as compared to other developing
countries in the region. Figure 1 presents the proportion of trained workers in Pakistan in relation to
other South Asian countries. Consequently, majority of the population is unemployed that
ultimately impact on health, education and quality of life (Janjua and Irfan, 2008). Many countries
leading in global workforce have heavily invests on skills development. Unfortunately, Pakistan
has fallen beyond in meeting the international TVET standards (GOP, 2009). Thus, extensive
TVET reforms are essential to support it in order to meet the demands of workforce in a
technologically advanced economy and global markets (Bushra, 2013 )

The growth of the TEVTA sub-sector is due to the Government’s desire to increase access of rural
youths and women to technical education and vocational training to improve their job skills and
means of livelihood. The lack of places in the universities also led to expansion of the sub-sector,
as it became an alternative channel for youth and school leavers. This resulted in the social demand
for more opportunities for and access to TEVTA. The Government assumed the main responsibility
of providing TEVTA to youths with little participation of the private sector. Only during the last
few years there has been a growing trend toward encouraging participation of the private sector in
TEVTA provision. Under the Education Sector Reforms Programme, a number of incentive
schemes have been introduced to enlist private sector participation in education and training
(Mustafa et al, 2005).

According to The National Skills Strategy (NSS) 2009 – 2013 the value and figure of
TVET teachers and trainers are essential to the efficiency and sustainability of the TVET structure.
The NSS has basic indicators for the featureupgrading of TVET workers, in which few are
professional and well trained instructors in the in-service and pre-service team and other are trained
managers of institutions. The NSS contain the following TVET staff associated actions: (Bushra,
2013)

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  Advance knowledge of technologies as well as Advanced teaching and judgment skills in
competency based training approaches
 Built capability principles for teachers and trainers
 Introduce a complete trainers and teacher training program
 Build a system of having professional expansion for teachers which can unite workplace
skills and professional growth
 Provide encouragement for attraction tocapable, skilled people into teaching and support
them to go throughin professional expansion
 Increase staff training organizationsfor the suitability and development of courses.

TEVTA has clear objectives and it works hard to complete these objectives so the present
condition of the Pakistan can improve.It is supposed that education perform a vital role in
developing the economical situations due to work can be improve.TEVTA objectives to make a
skilled labour that recognized through internationally level so demand of Pakistan skilled labour
increased. All these objectives can be achieved when TEVTA perform honestly (Biavaschi, 2012).

TEVTA is providing many reforms in various disciplines like degree of B.Tech, honors of B.Tech,
diplomas of technical education, Masters Degrees related to education of commerce, vocational
diploma and many others. But the most important aim behind this to development in the technical
education so the work can be done in qualitative view (Hina, 2015).

1.4 Reasons of Unemployment

Entering the labor market poses major challenges for young people in many countries. While it is
true that in general young people tend to be in a more vulnerable position than prime-age workers,
the recent economic crisis has shown that youth integration into the labor market is problematic in
some countries while it seems easier in other countries. In fact, some countries have been able to
maintain stable employment over the last years and decades, also in times of recession, while
elsewhere unemployment rates increased steeply. This clearly shows that insti-tutional settings and
public policies play a prominent role in influencing the transition from school to work. Promoting a
successful transition from school to work not only prevents long-term negative consequences of
early phases of youth unemployment and idleness, but it also en-hances individual professional
careers, earnings increases, economic productivity and social co-hesion (Biavaschi et al, 2013).
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1.5 Core indicators of unemployment
Key issues:
1. Comparative indicators on the socio-economic situation of young people are not straightforward,
in particular when it comes to a wider geographical coverage. A reliable picture can only be drawn
by combining different indicators.
2. Young people tend to face particular difficulties in entering the labor market. In general, young
people are in a more vulnerable position than prime-age members of the labor force, and they are
more severely affected by economic fluctuations.

1.6 Need for Technical Training

The demand for vocationally trained and technically educated human resource rises with every step
towards industrialisation and modernisation of production units and work premises. Yet another
outcome of such a transformation is the surge in demand for commercially educated human
resource with the inflow of capital.
Therefore, skill and capital are complementary. With the emergence of globalization there is an
increase of capital inflow from developed to developing countries implying that even without
technology imports, capital output ratios in developing countries would rise and, given the
complementarities between capital and skill, this would raise the relative demand for skilled labour
(O’Conner and Lunati 1999; Mayer 2000 and ADP 2004).

As with capital and skill, there are also complementarities between technology and skill. “The
stock of human capital appears to be positively correlated with technological dynamism (ADB,
2004). Technological changes have shifted demand toward higher skills in the labour force (World
Bank, 2002). The acceleration of technical change in recent decades has been complemented by
greater numbers of workers with higher skill. Acquiring new skills is a continuous process without
which it would be difficult to harness returns from technological progress. Additionally, a high rate
of labour turnover across industries and occupations is also necessary to cope with the rapidly
changing technologies and innovations: when people acquire skills, they commonly also make
themselves more adaptable (Booth and Snower, 1996) and ADB, 2004). Thus, adaptability
becomes crucial in order to keep the labour and capital employed and yet maintains
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competitiveness. New technologies are knowledge and skill intensive, and there is a need to train
people to work accordingly.
Vocational training caters to unemployed youths who lack skills and those who either drop out of
the school system or fail to qualify for admission in the polytechnic institutes and colleges.
Expansion in vocational training took place during 1980–1990, and included establishing several
training centers and upgrading a number of old ones across the country. The Ministry of Youth
Affairs also established 20 youth vocational centers. The duration as well as entry qualifications
for different vocational training programmes vary widely. Training programmes range from a few
weeks to 2 years and entry qualifications vary from middle to secondary school pass. Vocational
courses are more practically oriented compared with technical education. The curriculum of
vocational courses comprises 80 percent practical and 20 percent theory. Graduates are expected to
perform semiskilled and skilled jobs in various sectors or can be self-employed.

TECHNICAL and Vocational education is designed to prepare the individuals for specialize skills,
abilities, trade, industries, agriculture, business for self-reliance and it is generally linked with
manual and practical skills and commonly does not include academic abilities. Vocational training
often refers to education and training that focuses more on practical skills and being able to
perform tasks related to working in a particular industry. Technical Education is similar in nature,
but the focus is on technology and developments made in computers and digital information. These
skills encompassing individual’s knowledge and information to enter and make progress in
employment on productive basis. The major benefit of TEVT system is that it support for
alleviation of unemployment as it assist in increasing skills of youth for meeting the requirement of
industry. The aim of Technical and Vocational education system to provide trained manpower in
various applied fields, to provide technical knowledge and vocation skills. Trained and skilled
workforce has significant role in Economic development, Industrialization, Individual
Development, and to attract foreign direct investment (Hina, 2015)

Now a day large number of educated youth coming out from formal is unemployed. In Pakistan
perception on Technical and Vocational Education is negatives and considered a low status jobs
relating to it. Youngsters think about white collar job and feel embarrassment in job which is
related to practical work or work in factories. This is the main reason of unemployment which is

6
spreading all over the country. In Pakistan the TEVT system is controlled jointly by different
agencies such as Technical and vocational Training Authority (TEVTA), Punjab Vocational and
Training Authority (PVTC) and Skill development council. Provision of well-trained and skilled
workforce is the main objective of Technical and Vocational Education (Hina, 2015).

1.7 Formation of TEVTA

TEVTA was formed through an Ordinance (No XXIV of 1999) promulgated by Governor of the
Punjab which has now been replaced by TEVTA ACT (ACT X of 2010) Punjab.

1.8 Mission Statement of TEVTA

To enhance global competitiveness in Punjab, through a quality and productive workforce by

developing demand driven, standardized, dynamic and integrated technical education and
vocational training service.

1.9 Objectives of TEVTA

 Promote and provide demand driven technical education & vocational training.
 Re-engineer and consolidate the existing technical education and vocational training system
under one management structure.
 Develop a dynamic technical and vocational training system to ensure horizontal and
vertical mobility.
 Regulate and develop standards of technical education and vocational training including
internationally recognized curriculum, examination and certification system.
 Upgrade teaching abilities, skills and knowledge of teaching staff.
 Upgrade teaching equipment to the required standards.
 Establish close relationship with various sectors of economy namely Agriculture, industry,
Services and Commerce.
 Assess the manpower training needs in the context of domestic and global markets.
 Enhance the participation of Private Sector in training activities at Management level.
 Establish a system of public coordination through Boards of Management at District level,
coordinating all institutions in the District and their administration.
 Motivate the local entrepreneurs to patronize the training programs of TEVTA institutions,
provide on-the-job training facilities and employment to the graduates.

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  Set up regular Monitoring/Evaluation & Feedback system for the vocational training and
teaching education to respond efficiency to the existing and changing demand of the
economy.
 Develop & regulate examination, Trade Testing & Certification System to ensure
uniformity of Education & Training Standards.
 Prepare training plans, programs and projects keeping in view the local as well as foreign
manpower training requirements.
 Study and propose changes in the existing training legislations.
 Develop and offer need-based short courses in the sector of new technologies to the
Industry and also to offer services for solutions regarding associated production problems.
 Establish a staff development system to offer demand oriented teacher & instructor training
and upgrading performance.
 Organize and conduct seminars & workshops for various types of personnel associated with
vocational training and technical education.
 Establish Data Banks for skilled workers and technicians.

1.9 Most Operational Trades of TEVTA Faisalabad:

Table 1.1: Most Operational Trades of TEVTA Faisalabad

Sr. no Trades Sr. no Trades

1 Auto ( Mech) Petrol & Diesel 11 Lab Analyst

2 Auto Electrician 12 Plant Operator

3 Welder ( Arc & Gas) 13 Kitchen Operator

4 Electrician (General) 14 Stitching Machine Operator

5 Supervisor Dyeing & Bleaching 15 Knitting Machine Operator

6 Fitter Textile 16 Machine Man

7 Fitter Maintenance 17 Weaver

8 Chemical Plant Operator 18 Waiter

9 Bus hostess 19 Supervisor ( Spinning)

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10 Motor Bike Mechanic 20 Plumber

Source : http://www.tevta.gop.pk/about.php

Status of implementation of Apprenticeship Training Scheme as on 31.03.2017

 Notified industries: 566

 Operating industries: 362
 Apprentices enrolled: 23,331

1.10 Selected Operational Trades for Research

1. Motor Bike Mechanic

2. Electrician
3. Plumber

1.11 Plumber
A plumber is a tradesperson who specializes in installing and maintaining systems used for potable
(drinking) water, sewage anddrainage in plumbing systems. The term dates from ancient times and
is related to the Latin word for lead, "plumbum

Years of training and/or experience are needed to become a skilled plumber; some jurisdictions
also require that plumbers be licensed.

Some needed skills, interests, and values

 Reading drawings, and specifications to determine layout of water supply, waste, and venting
systems
 Detecting faults in plumbing appliances and systems, and correctly diagnosing their causes
 Installing, repairing and maintaining domestic, commercial, and industrial plumbing fixtures
and systems
 Locating and marking positions for pipe connections, passage holes, and fixtures in walls and
floors
 Measuring, cutting, bending, and threading pipes using hand and power tools or machines

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 Joining pipes and fittings together using soldering techniques, compression fittings, threaded
fittings, and push-on fittings.
 Testing pipes for leaks using air and water pressure gauges
 Awareness of legal regulations and safety issues
 Ensuring safety standards and building regulations are met.

1.12 Electrician
An electrician is a tradesperson specializing in electrical wiring of buildings, stationary machines,
and related equipment. Electricians may be employed in the installation of new electrical
components or the maintenance and repair of existing electrical infrastructure. Electricians may
also specialize in wiring ships, airplanes, and other mobile platforms, as well as data and cable.

Service electricians are tasked to respond to requests for isolated repairs and upgrades. They have
skills troubleshooting wiring problems, installing wiring in existing buildings, and making repairs.
Construction electricians primarily focus on larger projects, such as installing all new electrical
system for an entire building, or upgrading an entire floor of an office building as part of a
remodeling process. Other specialty areas are marine electricians, research electricians and hospital
electricians. "Electrician" is also used as the name of a role in stagecraft, where electricians are
tasked primarily with hanging, focusing, and operating stage lighting. In this context, the Master
Electrician is the show's chief electrician. Although theater electricians routinely perform electrical
work on stage lighting instruments and equipment, they are not part of the electrical trade and have
a different set of skills and qualifications from the electricians that work on building wiring.

1.13 Motor Bike Mechanic

A motorbike mechanic is a small engine mechanic who specializes in maintaining and repairing
traditional and nontraditional motorbike, scooters, dirt bikes, and mopeds
Motorbike mechanics service and repair the small engines in motorbikes and other types of related
vehicles. In addition to motorbikes, these mechanics may also work on snowmobiles, jet skis, and
riding mowers. Specific duties may include performing routine maintenance, repairing or replacing
defective parts, and reassembling engine components.

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Motorbike mechanics, like other small engine mechanics, work full-time during typical business
hours, although overtime is possible. Hours of work may change with the seasons and how heavy
the workload is for a particular repair shop. These mechanics generally work in well-lit repair
shops. Such locations can be noisy and contain some hazardous materials, as well as potentially
dangerous tools, so mechanics must exercise caution and wear protective gear when needed.

1.14 OBJECTIVES OF STUDY

- To study the socio-economic characteristics of respondents.

- To estimate the employment opportunity of Trainees.
- To compare the productivity and efficiency of Trained and Non Trained labour force.To
give policy implications.

1.15 Organization of the Study

The remaining study has been divided into four chapters. Chapter 2 is devoted to review
of literature. Chapter 3 describes sampling procedure and empirical models. Chapter 4 is devoted
to the results and discussions of the study. Chapter 5 winds up this study by drawing conclusions
and suggestions. Literature cited and appendices are given at the end.
CHAPTER 2

REVIEW OF LITRATURE

Shapiro and Muller (1977) estimated technical efficiency of 40 cotton farmers in

Tanzania by using a deterministic Cobb-Douglas production frontier obtained by linear
programming. The main objective of the study was to analyze the role of information and
modernization in the production process of cotton producers in Tanzania. The authors
found that technical efficiency had a high positive association with both information and
general modernization.

Kalirajan (1984) used a translog stochastic production frontier model to

investigate how the efficient use of new technology affected production levels in

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Philippine rice farms. Results of the study showed a wide variation in technical
efficiencies across farms, ranging from 42 to 91 percent. It was found that only 30
percent farms were operating close to the frontier. Results of the second stage analysis
showed that number of farm visits by extension agents was significant in explaining the
wide variation in the observed levels of technical efficiency. The author concluded that
new technology was not fully understood by the sample farmers.

Rawlins (1985) investigated the effects of the Jamaican Second Integrated Rural
Development Project (IRDPII) on the technical efficiency of small farmers. Data were
collected from 80 farmers participating in the IRDPII and from 72 non-participating
farmers. A Cobb-Douglas stochastic production frontier was estimated for each of the
two groups. Results of the study showed that there was relatively less variation of the
frontier across IRDPII farmers. Technical efficiency of non-participants was relatively
higher than that of participants and was estimated at 75 percent for non-participants and
71 percent for participants. However, despite of the lower technical efficiency for
participants than non-participants, the author concluded that the program had succeeded
in shifting outward the production frontier of the participant farmers by increasing their
level of technical efficiency.

Taylor, et al. (1986) estimated a Cobb-Douglas deterministic frontier production

function to analyze the impact of a World Bank sponsored credit program,
“PRODEMATA”, on allocative and technical efficiencies of farmers in Brazil. Maximum
likelihood (ML) and corrected ordinary least square (COLS) procedures were adopted to
estimate the production frontier. Estimates of technical efficiency for farms participating
in the credit program showed no major difference as compared to non participating farms.
However, participating farms exhibited slightly lower allocative efficiency than the
nonparticipants. This paper concluded that this credit program was not fruitful in improving
the farm level efficiency.

Pinheiro (1992) estimated technical, allocative and economic efficiency of small

farmers in Dominican Republic. The average technical, allocative and economic
efficiency was estimated at 70, 44 and 31 percent, respectively. The author found that the
farm size, education, farmer’s experience and contract farming had a positive impact on

12
technical efficiency while house hold size had a negative impact on technical efficiency
of farmers. The author concluded that contract farming and farm size were positively
related with allocative and economic efficiency while household size was negatively
related with both allocative and economic efficiencies.

Chavas and Aliber (1993) used a non-parametric approach to estimate technical,

allocative, scale and scope efficiencies for a sample of Wisconsin farmers. Results of the
study revealed that mean technical efficiency varied across districts from 0.85 to 1.0 in
the short run and from 0.92 to 1.0 in the long run. The mean allocative efficiency varied
from 0.76 to 0 .95 across districts in the short run and from 0.82 to 0.96 in the long run.
The mean economic efficiency varied across districts from 0.65 to 0.95 in the short run
and from 0.76 to 0.96 in the long run. The scale efficiency ranged across districts from
0.87 to 0.94. The mean scope efficiency varied across district from 1.36 to 1.74. The
authors concluded that the economic losses were commonly due to allocative and scale
inefficiencies and not due to technical inefficiencies.

Xu and Jeffery (1995) used a stochastic frontier and neoclassical cost frontier to measure
technical, allocative and economic efficiency of Chinese hybrid and conventional rice production.
Cross-sectional data for a sample of 90 hybrid rice households and 90 conventional rice households
were collected from the Jiangsu province. Average technical, allocative and economic efficiency
for conventional rice were higher than for hybrid rice. Average technical efficiency for hybrid rice
for south, central and north region was 0.85, 0.78 and 0.74, respectively. Average technical
efficiency for conventional rice for south, central and north region was 0 .94, 0.91 and 0.87,
respectively. Average economic efficiency for hybrid rice for south, central and north region was
0.61, 0.52 and 0.49, respectively and for conventional rice was 0.83, 0.80 and 0.74, respectively.
Average allocative efficiency for hybrid rice and for
conventional rice for south, central and north was 0.72, 0.67, 0.66 and 0.88, 0.86 and 0.85,
respectively. The authors concluded that the results were consistent with the ‘poor but efficient’
hypothesis. The small farmers were more efficient in allocating their inputs for convention rice
production than for hybrid rice production. Education was significantly related with the technical
efficiency. The authors also concluded that a positive relationship existed between land size and

13
economic and allocative efficiency in 38 modern agricultural regions (south) while the opposite
was true for traditional agricultural areas (north).

Hussain (1995) estimated farm specific allocative efficiency of wheat farmers in

the North West Frontier Province of Pakistan by using a stochastic frontier production
function. The author estimated restricted translog frontier production model by adopting
maximum likelihood (ML) procedure. The mean allocative efficiency of sample farmers
was 42.5 percent, ranging between 8 and 70 percent. It was found that 64 percent farmers
were allocatively efficient in the use of herbicide and 20 percent farmers were
allocatively efficient in the use of fertilizer. Sixty seven percent farmers were using
fertilizer lower than the optimum dose required to obtain maximum output, given the cost
outlay. The author concluded that farms which were located closer to the marketing
centers were allocatively more efficient than those located away from the marketing
center.

Barki and Shah (1998) estimated cost efficiency for a sample of 387 farms drawn
from five irrigated districts of Punjab, Pakistan. The authors estimated a stochastic
variable cost frontier model by using maximum likelihood (ML) procedure. Results of
the study indicated that the cost efficiency of farms varied from a low of 29 to a high of
95 percent with a mean efficiency of 76 percent. It was found that the technical
inefficiency raised the cost of an average farm by 24 percent. The authors concluded that
the observed technical efficiency of farms was positively related to formal schooling of
farm’s operators, abundance of canal water and head reaches of mogha. Small farmers
were more technically efficient than the large farmers.

Dearden et al., (2000) examined that either training effect on wages rate or not? The
training had direct and indirect connection with productivity of labour force and it can used as the
unit of measurement for overall efficiency of labour force in industrial point of view. This report
also examined the panel data taken from 1983 to 1996 of Europe industries. The survey had taken
from labour force over time about their education and their experience relevant of area. The data
had included increment of wages, wages rate and capital invested on industries. The result showed
that over time period training and education had positively boosted the productivity of labour force.

14
The data was collected using through GMM system. This report showed that effect of training can
be observed from two aspects. Firstly the firm should chosen when productivity become low, the
training had compulsory applied on labour force to achieved target productivity, the second
estimation should be prepared by firm that training on labour force gave at least 50% productivity.
It can be noticed form result that training in reality took the firm profit very high. Dynamic model
had used for estimation and OLS techniques applied.The overall result showed that if 5%
proportion invested on training on workers than 4% increased in labour productivity 1.6% in wages
rate and 15% in overall production.

Ahmad, et al. (2002) used a stochastic production frontier analysis to analyze wheat
productivity, efficiency and sustainability of 1828 wheat farmers belong to irrigated area in Punjab,
Sindh and NWFP Provinces of Pakistan. Results of the study showed that the average technical
efficiency was about 68 percent showing a 32 percent loss in output, on an average, due to farmer’s
technical inefficiency. It was found that the younger farmers were technically more efficient that
the older ones. Farm size, education, access to credit and farm to market distance were positively
related with the technical efficiency. Farmers in Punjab were technically more efficient than their
counterparts in Sindh and NWFP

Helfand (2003) estimated determinates of efficiency and explored relationship between

farm size and efficiency of farms in Center-West of Brazil. The author used data envelopment
analysis (DEA) approach to estimate technical efficiency of the farms. A non-linear relationship
between farm size and technical efficiency was estimated. The author concluded that access to
institutions, credit and modern inputs were important determinants that caused differences in
efficiency across the farms. The author suggested that improved access to institutions, credit and
modern inputs could strengthen the efficiency advantages of small and medium farms.

Mustafa et al.,(2005) explored adverse situation in Human recourse development and

focused that workers get jobs but they were still un skilled. Methodology used on quantitative data
and applied Logit model, OLS through SPSS. This report conclude that training and education was
not only main part but it was also the source of creating jobs, produced growth and improved the
capability of economy situation. This report suggested that improved education and training cold
took employment level from bottom to top.
15
 Amaza and Maurice (2005) investigated determinants of technical efficiency in rice-based
production systems among Fadama farmers in Nigeria. The authors estimated stochastic frontier
production function that incorporated technical inefficiency effects, using the maximum likelihood
(ML) procedure. Results of the study revealed that elasticities of output with respect to land, seed
and other inputs were significant. The mean technical efficiency of farmers was estimated at 0.80.
It was found that farming experience and education significantly affected framer’s efficiency
levels.

Rios and Shively (2005) used two steps methodology to investigate the technical and cost
efficiency of smallholder coffee farms in Vietnam. The data were collected from 209 coffee
farmers from two districts in Dak Lak Province. The authors used data envelopment analysis
(DEA) technique to estimate technical and cost efficiency of coffee farms. Results of the study
showed that the large farms were technically more efficient than the small farms. The average
technical efficiency for large and small farms was 0.89 and 0.82, respectively. The authors
concluded that education level was positively related while length of irrigation pipelines was
negatively related with the efficiency of the small farms. Access to credit and security of tenure
were not significantly related with the efficiency of the sample coffee farms in Vietnam.

Bozoglu and Ceyhan (2006) measured technical efficiency of vegetable farmers in Turkey,
using stochastic production frontier approach. The data were collected from 75 vegetable farmers
from Samsun province of Turkey for the year 2002-03. Average technical efficiency of vegetable
farmers was estimated at 0.82, ranging between 0.56 and 0.95. It was found that variables of
schooling, experience, credit use, participation by women and information had negative effect on
the technical inefficiency of vegetable farmers. However, age, family size, off-farm income and
farm size showed a positive relationship with the technical inefficiency. The authors suggested that
strategies such as providing better extension services and farmer training programs and providing
farmers with better access to credit could enhance technical efficiency of vegetable growers in
Turkey.

Ogundari and Ojo (2006) examined technical, economic and allocative efficiency of small
cassava farms in Osun State of Nigeria. The authors used stochastic frontier production function
16
model and cost function model to predict the technical and economic efficiency respectively. The
predicted technical and economic efficiencies were used to calculate the allocative efficiency of
cassava farms. The predicted mean technical efficiency was 0.903 ranging from 0.689 and 0.981,
the predicted mean allocative efficiency was 0.89 ranging between 0.411 and 0.979 and the
predicted mean economic efficiency was 0.807 with a lowest of 0.325 and a highest of 0.952. This
paper concluded that technical efficiency was more significant than allocative efficiency as a
source of gain in economic efficiency.

Idiong (2007) investigated farm level technical efficiency of 112 small-scale swamp rice
farmers in Cross River State of Nigeria. The author estimated a stochastic production frontier that
incorporated inefficiency factors by using a maximum likelihood (ML) procedure. Results of the
study showed that the mean technical efficiency of small scale rice farmers was 77 percent, with a
lowest of 48 and a highest of 99 percent. The author concluded that farmer’s educational level,
membership of cooperative/farmer association and access to credit were significantly and
positively associated with the efficiency of small-scale swamp rice farmers in Nigeria.

Bakksh (2007) used a stochastic frontier production function incorporating technical

inefficiency effect model to estimate technical efficiency and profitability of growing vegetables in
Punjab. Four vegetables namely potato, carrot, radish and bitter gourd were selected for the study.
Results of the study showed that the mean level of technical efficiency was 82 percent in case of
radish, 72 percent in case of carrot, 70 percent in case potato and 66 percent in case of bitter gourd.
The author found that with an increase in age of the vegetable growers, level of technical efficiency
declined except in potato production. Education level and access to extension services were
positively related to the level of technical efficiency in cultivation of all vegetables. The most
profitable vegetable was bitter gourd followed by carrot, potato and reddish.

Ishaq et al., (2008) estimated technical, allocative and economic efficiency and
subsequently to investigate the determinants of technical, allocative and economic inefficiency of
rice-wheat cropping system in Punjab, Pakistan. Technical, allocative and economic efficiencies
were estimated by using data envelopment analysis (DEA) technique. The mean technical,
allocative and economic efficiency scores of the sample farms were of the order 0.83, 0.477 and

17
0.402 respectively. An econometric analysis based on Tobit Regression models indicated that farm
size, age of farm operator, years of schooling, number of contacts with extension agents, access to
credit and farm to market distance were significant determinants of technical efficiency whereas
years of schooling, number of contacts with extension agents and access to credit had significant
impact on allocative and economic inefficiencies of sample farms in the rice-wheat system in
Punjab.

Ishaq et al., (2010) estimated technical efficiency and identify the determinants of technical
inefficiency of rice-wheat farming system in Punjab. For this purpose a non-parametric data
envelopment analysis (DEA) technique was applied. Tobit regression model was estimated to
investigate determinants of technical inefficiency of the system. The results revealed that mean
technical efficiency of the system was 0.83, with minimum level of 0.317 and maximum of 1. This
indicated the existence of substantial technical inefficiency in rice-wheat system in Punjab. The
study further revealed that if sample farms in rice-wheat system operated at full efficiency level
these could reduce their input use by 17 percent without any reduction in level of output and with
existing technology. Results of the Tobit regression model showed that years of schooling, number
of contacts with extension agents and access to credit variables had negative impact while farm
size, age of farm’s operator and farm to market distance had positive impact on technical
inefficiencies of rice-wheat system in Punjab. It was suggested that government should focus on
attracting young and educated people in farming by providing incentives in the form of soft loans.

Hussain et al., (2010) found that women should obtained skilled and analyzed that women
could supported their families in any uncertainty happened if they would well trained and well
educated. Methodology used on descriptive data & descriptive Method was applied. The results
presented in graphical way. The finding result showed women empowerment in AJK (Azad Jammu
Kashmir) was vulnerable by two aspects that were basically linked a conventional society, and
limited job perspectives. This research suggested that Government should enhanced vocational
skills training programs for women in all different areas of Pakistan specially in AJK. This report
also elaborated that impact estimations were very difficult to be seen. The steps could be
reasonable as well as the public side beneficent.

18
 Khilji et al., (2012) explored that Slow growth in Production sector due to less efficient
Labour Force and focused on GDP and literacy rate were moving to adverse situation. Quantitative
data was used and Solow growth Model applied for estimation. Johan Co integration was used
through SPSS. This report concluded that spending on education sector by the government helped
in increasing the literacy rate and the stock of capital in country. The emerging literacy rate in turn
improved the capital stock further and human capital as well. This report suggested that
information of professions should be prepared and well organized by managing authorities. The
special sectors should be established which provide complete information about each profession of
production to related staff.

Biavaschi et al., (2012) focused that Youth was unemployment & unskilled. The Labour
was also unskilled and unemployment and it was adverse situation among developing countries.
Descriptive data is used for expected results. This report showed results on graphical way. This
research concluded that many factors effected the labor market and youth current situation in a
country: On the one side the relationship between demographic expansion, economic enlargement
and labor market system concerning wages and employment protection which determined the total
demand and supply for young workforce. This report suggested that education system was
necessary and pre-condition for the generated employability and efficiency of young workers.
Education had showed definite theme that helped about how to attain skills. Basic education and
vocational training were vital role in making young people employable at a top level of
productivity.

Ahmed (2012) examined that Human Capital was an important factor of economic
development. It included of various factors such as health, migration, education, IT expansion and
vocational training,. Vocational training & skill growth are most important factors among them.
Through Vocation training improvement output and expansion of productivity and its efficiency
regarding labour can be more better. This contribution in economic growth can make a definite
change overall society. The aim of this report was to calculate the impact of vocational training on
economic development of Pakistan for the period during 1980-2010. Johnson co integration
technique & error correction methods (ECM) were used to find out relationship through using
granger causality included error correction framework also used to find out the path of connection
between the variables. Solow growth model was used to find out the overall productivity. This
19
report suggested that official apprenticeship programs had not showed the desired consequence
because different reasons. There had been significant conflict on the part of owners of firm to
create such plans that help the employee to work with encouragement. It is compulsory for
employers should be promoted such schemes .The informal sector had made wonderful
involvement to create skills training programs in Pakistan. A plan must be created to train their
manpower in specific fields in a more organized and technical manner. To meet the future
challenges of technical development, the current vocational and technical training system needed to
be enhanced and noticeable with the requirements of the economy. The function of private sector
requires to be improved and manufacturing relations should be maintained and optimistic. There is
requirement for arranging computer training skills and beginning of in service training and
vocational educations arrange the resources for private sector expert manpower.

Diasa and Tebaldib (2012) analyzed the relationship between human capital, institutions,
and economic growth. The paper first developed a micro-foundation model linking institutions to
human capital. The advantage of our modeling strategy was that the human capital accumulation
function was derived from an endogenous process. The theoretical model showed that
improvements in the quality of institutions foster human capital accumulation, decrease income
inequality and change the historical development path. This paper used cross-country panel data
from 1965 to 2005 to test some of the model’s propositions and found that deep structures or
structural institutions which were very persistent and rooted on the historical development path of
an economy affected long-term economic performance, while political institutions were
uncorrelated with productivity and long-term economic growth. The empirical estimated also show
that growth of physical and human capital instead of levels determines long-run economic growth.

Bushra and Wu (2013) noticed that Technical and vocational education and training
(TVETA) performed a significant role for socio economic growth of a country. The summary of
familiar reviews repeated that the TVETA segment in Pakistan needed some extensive changes to
solve the challenges of worldwide skilled labour market. This paper focused on the improvement of
TVETA in Pakistan with specific highlight as “Skilling Pakistan” must be include in National Skill
Strategy (NSS) (2009-2013) & the progress of TVETA improvement related program (2011-2016).
The existing growth showed suitable performance for getting 20 planned reforms under 4 main
mechanisms points. Under the (Skilling Pakistan) reforms some physical changes for making a
20
famous internationally TVET system should be established and also planned to attain the basic
objectives. Furthermore, proper system for the execution of planned reforms must also achieved
with evaluating & performance to achieve the growth using overall achievement indicators. The
report suggested that Government should execute completion of the existing reforms with equality,
equity, quality& equal admittance to construct a lifetime learning society.

Klaus et al., (2013) focused on the determinants of the labor market situation of young
people in developed countries and the developing world, with a particular emphasis on the role of
vocational training and education policies. We highlight the role of demographic factors, economic
growth and labor market institutions in explaining young people’s transition into work.
Subsequently, we assess differences between the setup and functioning of the vocational education
and training policies across major world regions as an important driver of differential labor market
situation of youth. Based on our analysis, we argue in favor of vocational education and training
systems combining work experience and general education and provide some policy
recommendations regarding the implementation of education and training systems adapted to a
country’s economic and institutional context.

Zahra et al., (2013) focused on employee’s attitudes in job related education, their behavior on job
timing and behavior on job training. Panel data was used for calculation in this regard. This study
examined that the workers who made the school to work evolution energetically contributing in
their own labor market improvement. This research was also about worker’s awareness about their
education and training. The data suggested that job related skills were acquired from a various
grouping of resources within work places and education training institutions. The calculated result
showed that employee’s education and training made them high skilled, capability, good work,
recognition of work and improved skill expansion. The staff with high skills can easily recognize
the troubles, having enough information to solve the troubles and have skill to perform well. The
purpose of worker’s job training and education was to groom their intellectual level and to improve
the skills in the employees. This data executed the perception of society and among employees job
training and education. This study was established through using the theoretical structure about
employee job training and education. This theoretical structure explored that association at a huge
extent and in complete quantity. The most important purpose was to calculate whether association

21
present between training and education & if so then in which aspect it was exist. Education &
Training deal with the more composite relations among education training & service and the
impact of these relations on countrywide and worldwide labor markets. The report suggested that
the impact of skill and performance on workers training and education are more considerable while
aim to get high profit and productivity. Skills have much strong impact either on capability or
productivity.

Neelam and Israr (2014) focused that workers had less productivity and they were
untrained. Also explored that poverty caused many social issues which were spreading in economy.
Methodology used on Quantitative data and quantitative Method applied through simple
Regression Model, OLS via SPSS. This report concluded the main aim of every institution was
improved by its performance but it could never be possible without the competent performance of
workers. Also Suggested that bank’s’ administration should interested in their efficiency and
productivity was left with no any other alternative than to adopted Training and Development
system.

Asghar et al., (2014) examined that National Skills Strategy (NSS) had made purposes to
support private enterprise between the students of technical Vocational( TV) & education training
(ET) in Pakistan. This repost find out impact of 18th modification in the objectives of Punjab Skill
Development Plan (PSDP), (NSS) and (TEVTA) in Punjab and their consequences. This research
aimed to explore the attempt of TEVTA Punjab for encouraging the private enterprise education
along with the students of vocational training institutes and also aimed find out the impact of the
private enterprise education on students attitudes. This study was focused on theoretical structure
of the Theory of Planned Behavior presented by Ajzen in (1990) which was mostly quantitative
research which explored the students those had taken part in private enterprise education course
and those had not contributed in private enterprise education module. It was examined that
entrepreneurship education had an positive impact on students behavior and attitudes to developed
their self into an industrialist. Structural equation model was used for estimation through likert
scale questioning. This report had convenient implications for TVETA institutions and skill
education programs (SEP) to create private enterprise education and helped TVETA policy makers,
officers and prospectus developers to improve industrial attitudes of students. This report suggested
that adaptation of the capitalist prospectus for successful delivery of the private enterprise

22
education and Government should made effort towards serious implementation of
entrepreneurship education in which prospectus stream, evaluation system must be included for
the secure future of students

Norashidah (2015) explored that why a person preferred to be a capitalist and what factors
forced towards getting goals for capitalist requirements? Capitalist education was treated as an
significant variable which made effect on capitalist purposes. Empirical research model was taken
to estimate the results. To investigate additional this question from emergent countries viewpoint,
this paper looked at the position of capitalist education in making the capitalist aim for becoming
capitalist. The sample collected of final year business administration students from Pakistan. The
result supported the capitalist intention model focused on the theory of planned attitude. The results
more suggested important effect of capitalist education on capitalist purpose of the students.
Furthermore, this study showed that theoretical information of private enterprise (know what) and
information of social network expansion (know who) parts were very important for informing
entrepreneurship education. Qualitative data was used in this regard. The suggestion was
elaborated that students should get knowledge of entrepreneurship and started their own businesses.

Robert (2015) examined that education appeared to be receiving quite a lot of attention in
post-2015 discussions, but how this would translate into goals and targets remains to be seen.
Meanwhile, despite increased global recognition and awareness of the importance of technical and
vocational skills development (TVSD) as evidenced in the bumper year of reports on TVSD in
2012, TVSD does not appear to be getting as much focused in post-2015 discussions. It was known
that the EFA ‘skills’ goal never got any traction: no one could even agree on what ‘life-skills’
meant, let alone how it should be measured or tracked. This paper would take a look at some
lessons from history and then explore the current state of affairs to analyzed the latest post-2015
suggestions and the way they cover TVSD

Steven et al., (2016) investigated work motivation and work engagement, along with their
associated factors, among unemployed young people participating in vocational training schemes
in Tianjin, China. Derived from a sample of 209 young trainees (mean age = 22.67, SD = 1.93), the
results supported the hypotheses that training adequacy and self-actualization showed positive

23
effects on work motivation and work engagement. Furthermore, training variables (the number of
training courses attended and duration of workplace training) did not present any significant direct
effect on either work motivation or work engagement; however, they predicted the two outcome
variables indirectly through the mediating effects of training adequacy and self-actualization. The
study implied that power, skills, and other resources gained during the training provided fuel for
motivation and performance. The study also advanced the human capital development approach by
unraveling the mechanism through which hard skills and soft skills contribute to youth
empowerment and employment. The implications of these present findings for theory, practice, and
policy were also discussed.

24
CHAPTER 3
METHODOLOGY

The purpose of this chapter is to describe sampling procedure, descriptive statistics of the sample
farms and empirical models. First section describes sampling procedure, sampling size and method
of data collection from the field. The second section sheds light on the descriptive statistics of the
sample farms. The last section is devoted to the empirical models for the estimation of technical
efficiency and sources of technical allocative and Tobit Regression model for conducting results.
Research is the process of the collection, analysis and preparation of the certain data relevant to the
subject of research. It is application of systematic techniques and methods in pursuit of answers of
questions. Social research is concerned with exploring, describing and explaining social
phenomenon involving human behavior. Methodology is defined as the logic of specific procedure.
This chapter deals with methodology. Methodology is the system of principles and methods of
organization, constructing, theoretical and practical activity. It is referring to more than a simple set
of methods; rather it refers to the rational and the philosophical assumptions that underline a
particular study. Research methodology include the tool and techniques of collection and analysis
of data, this is applied for particularly testing the hypothesis. That’s why scholarly literature often
includes a section on the methodology of the researchers.

This section does more than the outline of the research methods. Hence various techniques and
procedures employed for the selection, analysis and interpretation of data in the present
investigation are discussed. A very important thing for conducting any study is the adoption of
appropriate technique. After formulating the study and its objectives, the successful conduction and
completion of the study depends upon employing the appropriate methodology. For methodology
purpose, the selection of the sample, data collection techniques, different variables and their forms
in which they were used and selection of an appropriate model have been described in detail under
this chapter.

3.1 Questionnaire preparation

25
In the empirical research, one of the important tasks was to prepare the questionnaire. To collect
the reliable information, deep and intense research study was required. After the study of different
research papers, articles, journals, old thesis and previous studies a questionnaire containing about
30 questions was developed keeping in mind the requirements of this study. Both open ended and
closed ended questions were included in study questionnaire. For the efficient and accurate primary
survey following parts of the questionnaire were prepared.

3.2 Pre testing

Before starting the collection of the primary data, pre testing is performed in the research area and
for the research point of view. This is very useful before formal data collection. So, after the
preparation of the final questionnaire, pre testing plays a vital role to avoid that material and
information which is irrelevant to the study and collect only relevant information. For this purpose,
twenty respondents from the study area were selected randomly and after this some relevant
questions were included and some irrelevant questions were excluded from the questionnaire. Pre
testing proved to be very useful before starting survey as many questions which were thought to be
very important for the survey were also included to the questionnaire after the pre testing.

3.3 Survey

A survey was conducted in Faisalabad using purposive and respondent-driven sampling. In the
survey, the household asked direct questions to collect the data for the objectives of this study.
Although information can be collected through telephonic conversation and by mail but for
attaining more reliable information, data should be collected through directly interviewing the
respondents. Therefore, for this study data was collected through directly interviewing the
respondents by using questionnaire. Questions related to the productivity, efficiency, monthly
earnings of the respondents, Avg working per day, working experience and employment status, etc,
and social economics information were asked to fulfill the need of this study. Although the
questionnaire was formatted in English language for academic purpose but the questions were
asked into Urdu and somewhere in Panjabi which is the regional language of the Faisalabad. This is
done for according to the situation in order to get maximum information. In short the data were
collected by the researcher herself in 20 to 30 days by interviewing the respondents in Faisalabad

26
city. All the respondents were interviewed personally and collect maximum information from
them.

3.4 Field experience

The field experience during data collection was interesting. In social research, researcher has to
face a lot of difficulties usual the common problems are co-operation of the respondents, who did
not respond in a desired manner or they did not follow the nature of different questions.

3.5 Data collection

The achievement and success of the research work done mainly depends on reliability of data and
the way how carefully the data were collected. The house samples were selected through stratified
random technique from each selected town. The selected houses were observed and requisite
information was inquired in local language for better understanding. The collected information was
recorded in the predesigned questioner in English language and was transferred to the computer.

3.6 Data editing and coding

After data collection the interviewing schedule were properly checked to make sure that all the
responses had been recorded accurately. Sequentially all interviewing schedules were numbered in
a serial order. After editing the interviewing schedules data were transformed from questionnaires
to computer Excel sheet forms.

3.7 Empirical analysis

After editing the data in computer following statistics tools and techniques were adopted for
empirical analysis.

27
3.8 Descriptive analysis

For objective 1 socio characteristics of people in Faisalabad city, descriptive analysis was
used to find out the percentage and frequencies of different variables.

Average was calculated by using following formula

AM= ∑X/N

AM= Arithmetic Mean

N= Total number of observations

∑X= Total sum of variables

Percentage was calculated by using formula

P= F/N*100

Where; F= Frequency of class

N= Total number of observations

3.9 Productivity and Efficiency

The terms productivity and efficiency are often used interchangeably but they are not precisely the
same things. Productivity is an absolute concept and is measured by the ratio of outputs to inputs
while efficiency is a relative concept and is measured by comparing the actual ratio of outputs to
inputs with the optimal ratio of outputs to inputs.

Productivity can be divided into two sub-concepts: Partial Factor Productivity (PFP) and Total
Factor Productivity (TFP). Partial Factor Productivity is the average productivity of a single factor,
measured by total output divided by the quantity of a factor applied. Total Factor Productivity is
the productivity of all factors taken together.

28
The efficiency of a firm is defined as the actual productivity of a firm relative to a maximal
potential productivity (Farrell, 1957). Maximal potential productivity (also known as best practice
frontier) is defined by the production frontier. Measurement of efficiency involves measurement of
the distance from observed data point to that frontier (Lissitsa, et al. 2005).

Efficiency is an important economic concept and is used to measure the economic performance of a
production unit. Efficiency in production is usually referred as economic or productive efficiency
of a firm which means it is successful in producing as much output as possible from a given set of
inputs. Production efficiency is concerned with the relative performance of the process used in
transforming inputs into outputs.

Allocative efficiency is the ability of a firm to use inputs in optimal proportion, given their
respective prices and the production technology. The use of an input is allocatively efficient if the
value of marginal product is equal to its price. According to Lovell (1993), a firm working
allocatively efficient combines inputs and output in optimal proportion in the light of established
prices. Allocative inefficiency arises when factors of production are used in proportion that does
not minimize the cost of producing a given level of output. In other words, allocative inefficiency
arises when a firm is failed to equate the ratio of marginal product of inputs to the ratio of market
prices. Economic efficiency is the product of technical and allocative efficiency. A firm both
technically and allocatively efficient is said to be an economically efficient firm.

3.10 Estimation of Technical Efficiency

Technical efficiency scores can be obtained by running a constant returns to scale DEA model or
variable returns to scale DEA model. Technical efficiency scores obtained from constant returns to
scale DEA model is called total technical efficiency and from variable returns to scale DEA model
as pure technical efficiency.

3.11 Constant Returns to Scale DEA Model

Charnes, et al. (1978) proposed an input oriented DEA model for the first time under the
assumption of constant returns to scale. Assume we have data on K inputs and M outputs of N

29
firms, x1 is an input vector for the ith firm and y1 is an output vector for the ith firm, X is an input
matrix for N firms and Y is an output matrix for N firms.

The envelopment form of the input-oriented constant returns to scale DEA model is specified as
follows:

min θ,λ θ,

subject to

-yi + Yλ ≥ 0

θxi - Xλ ≥ 0

λ≥0

where θ is the technical efficiency score of ith firm and λ is a Nx1 constants. The value of θ
must satisfy the restriction: θ ≤ 1. If θ is equal to 1, it indicates that the firm is on the production
frontier and is a technically efficient farm (Coelli, et al. 1998).

3.12 Variable Returns to Scale DEA Model

Coelli, et al. (1998) suggests that constant returns to scale DEA model is only appropriated when
all firms are operating at optimal scale but it is not possible in agriculture due to many constrains.
The use of constant return to scale DEA model when all firms are not operating at optimal scale
results in measures of technical efficiencies that are confounded by scale efficiencies. In order to
avoid this problem, Bankers, et al. (1984) modified constant returns to scale DEA model to
variable returns to scale model by adding convexity constraints. The use of variable returns to scale
DEA model allows the calculation of technical efficiency free from the effects of scale efficiencies.

The envelopment form of the input-oriented variable returns to scale DEA model is specified as
follows:

min θ,λ θ,

subject to

30
 -yi + Yλ ≥ 0

xi - Xλ ≥ 0

N1/ λ = 1

λ≥0

where N1/ λ = 1 is a convexity constraint which ensures that an inefficient firm is only
benchmarked against firms of a similar size. θ is the technical efficiency score of the ith firm.

3.13 Estimation of Scale Efficiency

Data envelopment analysis (DEA) is a deterministic method to estimate technical efficiency. It

does not estimate explicitly a random error term and the overall deviation from the frontier is
interpreted as inefficiency. On the other hand, a standard frontier production model uses a
composed error structure with a one sided component and a two sided symmetric term. One-sided
component indicates technical inefficiency effects associated with technical inefficiency of a firm
while two-sided component accounts for measurement errors in production and other random
effects, which are not under management control.

The use of data envelopment analysis (DEA) provides an opportunity to decompose the total
technical efficiency into pure technical and scale efficiency. Pure technical efficiency relates to
management practices while scale efficiency relates to the residuals. Thus the results enable better
understanding of the nature of technical inefficiency of farmers belonging to different farm size
groups and assess the possibilities for productivity gains by improving the efficiency of farmers.
Scale efficiency can be obtained residually from CRS and VRS technical efficiency scores as
follow:

SE= TECRS/TEVRS

SE= 1 indicates scale efficiency or constant return to scale (CRS) and SE <1 indicates scale
inefficiency. Scale inefficiencies arise due to the presence of either increasing returns to scale or
decreasing return to scale.

31
Data envelopment analysis (DEA) also provides means to assess whether a particular firm is
operating in an area of increasing returns to scale or the decreasing returns to scale. This may be
determined by running another DEA model under non increasing returns to scale (NIRS). NIRS
data envelopment analysis (DEA) model under the assumption of variable return to scale is
specified as:

min θ,λ θ,

subject to

-yi + Yλ ≥ 0

xi - Xλ ≥ 0

N1/ λ ≤ 1

λ≥0

The nature of the scale inefficiency for a particular firm, due to increasing returns to scale or due to
decreasing returns to scale, can be determined by seeing whether the non increasing returns to scale
technical efficiency score is equal to the variable return to scale technical efficiency score. If they
are unequal, then increasing returns to scale exist but if they are equal, decreasing return to scale
exists for the firm

3.14 Tobit Regression Model

A question of great interest for policy markers is: Why efficiency differentials occur across the
farmers of the same farming system? They may be the reflection of managerial ability and skill of a
farm’s operator and interaction of various socioeconomic factors. The present study made an
attempt to investigate the impact of various socio-economic and farm specific factors on technical,
allocative and economic inefficiency of informal trained respondents in Faisalabad. The total
technical efficiency has two components: pure technical and scale efficiency. Pure technical
efficiency relates to management practices while scale efficiency relates to the residuals.

Therefore, only pure technical inefficiency was chosen as the independent variable in the analysis
of factors explaining the technical inefficiency differentials among the sample

32
farms in both Informal and TEVTA.

In order to estimate the sources of technical, allocative and economic inefficiency of farms, various
socio-economic and farm specific variables were regressed on inefficiency estimates of farms using
Tobit regression model. Studies by Kalirajan and Shand (1988) and Haji (2006) showed that
efficiency of production was determined by the host of socio-economic and institutional factors.
These factors directly/indirectly affect the quality of management of the farm’s operator and
therefore, are believed to have impact on the level of technical, allocative and economic
inefficiency of farms.

According to Bukhsh (2007), a range of factors like distinctiveness of farms, management,

physical, institutional and environmental aspects could be the cause of inefficiencies in the
production process of the farmers. These factors directly or indirectly affect the quality of
management of farm’s operators. Bravo-Ureta and Pinheiro (1997) indicate that it is not possible to
come up with complete list of all the factors affecting the farm specific efficiency but only the most
important socio-economic and demographic variables that are expected to affect the farm specific
efficiency are considered.

Socio-economic and farm specific variables included in this study were: years of schooling of the
household head, age of farm’s operator, contact with extension agents, farm to market distance,
access to credit and tenancy status of the farm’s operator.

Y= β0 + β1X 1+ β2X2 + β3X3 + β4X 4+ β5X5 + μ

Y= Technical Efficiency
X1 = Education (years)
X2 = Age (years)
X3 = Experience (Years)
X4 = Total Income
X5 = Avg. Working Hrs
X6 =Duration of getting Skills
33
3.15 Statistical Analysis and Interpretation of the Data

In this present study to identify the effect of socio-economic factors of respondent Descriptive
analysis was used.

All data were analyzed using statistical package for social sciences (E.Veiws) and (DEAP). Tobit
was applied on data of to calculate the level of significance (P). The value of P less than or equal to
0.05 was considered statistically significant and more than 0.05 was considered statistically non-
significant. Interpretation of the data was done by plotting a regression line.

3.16 Sampling Procedure

The study was conducted in TEVTA Trained respondent and and Informal Trained respondent in
Faisalabad region and a Two-stage sampling design was used for collection of information from
the field. First stage units were TEVTA trained respondent and second stage units were informal
Trained respondent across all Faisalabad like main city and correspondent areas. During first stage
TEVTA Trained respondents data were taken from Faisalabad main office and take required
information from them on telephonic conversation. In the second stage randomly data were
collected across all Faisalabad region by taking interview them and get all required information. A
list of respondents in each selected stage was prepared and necessary information regarding
respondent name, Family size, age, Education, material status, training center, salary , total income,
own business detail, employer detail etc was collected. Ninety respondents were selected from
TEVTA training centers and Ninety respondents were selected randomly from Faisalabad region
for their comparisons and efficiency purpose. Total 180 respondents were selected.

3.16.1 Selection of Study area from TEVTA trained respondents

For the purpose of selection of study area and data collection from TEVTA training centers. Thirty
respondents were selected as Plumber in which seventeen respondents were employed in different
shops, companies and thirteen respondents were self employed and owned their business. Twenty
nine respondents were selected as Electricians in which Twelve respondents were employed in
different shops, companies and seventeen respondents were self employed and owned their
business. Thirty one respondents were selected as Motorbike Mechanic in which eighteen
34
respondents were employed in different shops, companies and thirteen respondents were self
employed and owned their business.

Table 3.1 Selection of TEVTA Trained Respondent from Faisalabad

Skills and Major Employed Self Employed Total

Occupation

TEVTA Trained Plumber 17 13 30

TEVTA Trained Electrician 12 17 29

TEVTA Trained Motor Bike 18 13 31

Mechanic

Total 47 43 90

3.1.2 Selection of Study area from Informal trained respondents

For the purpose of selection of study area and data collection from all across Faisalabad region.
Thirty respondents were selected as Plumber in which fifteen respondents were employed in
different shops, companies and fifteen respondents were self employed and owned their business.
Thirty respondents were selected as Electricians in which fifteen respondents were employed in
different shops, companies and fifteen respondents were self employed and owned their business.
Thirty respondents were selected as Motorbike Mechanic in which fifteen respondents were
employed in different shops, companies and fifteen respondents were self employed and owned
their business.

35
Table 3.2 Selection of Informal Trained Respondent from Faisalabad

Skills and Major Employed Self Employed Total

Occupation

Informal Trained Plumber 15 15 30

Informal Trained Electrician 15 15 30

Informal Trained Motor 15 15 30

Bike Mechanic

Total 45 45 90

CHAPTER 4
RESULT AND DISCUSSION

This chapter is devoted to the presentation and discussion of results obtained through
Descriptive analysis, DEA and Tobit regression models.

4.1 Descriptive Analysis

4.1.1Social status and Age of the Respondents

Age affects the working capacity of households young households have good income and capacity to
work than old household (Barrientos et al., 2003). The In the survey, respondents were asked their
age. Age is play important role in the efficiency and productivity analysis. The tables present the
frequency distribution and percentage shows that from the 180 respondents in which 90 belongs to
informal trained respondents and 90 belongs to TEVTA trained respondents. 13 and 48 were age
between 20 and below of Informal trained and TEVTA trained respectively and their percentage were
36
14% and 53% respectively. 27 and 36 were age between 21-25 of Informal trained and TEVTA trained
respectively and their percentages were 30% and 40% respectively. 24 and 6 were age between 26-30
of Informal trained and TEVTA trained respectively and their percentages were 27% and 7%
respectively. 17 were age between 31-35 of Informal trained only and its percentage was 19%. 9 were
age between above 35 of Informal trained only and its percentage was 10%. The whole summary
explain that TEVTA trained were less old as compare to Informal trained. Below the table the graph
was also shown.

Table 4.1.1 Social status and Age of the Respondents

TEVTA
Age of respondent Informal Trained Percentage Trained Percentage

20 and Below 13 14% 48 53%

21-25 27 30% 36 40%

26-30 24 27% 6 7%

31-35 17 19% 0 0%

Above 35 9 10% 0 0%

Total 90 100% 90 100%

Source: Author’s own calculations

37
 60

50

40

30 Informal Trained
Tevta Trained

20

10

0
20 and Below 21-25 26-30 31-35 Above 35

4.1.2 Social status and marital status of the Respondents

In the survey, respondents were asked about their marital status. Marital status is concerned with the
Technical efficiency. The table present the frequency distribution and percent shows that, in the 90
respondents from informal trained, majority 60 were married and 30 were single. The result of
percentage shows that in the 100 percent 67 percent were married and 33 percent were single. Same as
90 respondents from TEVTA trained, majority 80 were un-married and 10 were single. So TEVTA
Trained respondent were young and single as compare to Informal Trained respondent. Below the table
the graph was also shown.
Table 4.1.2 Social status and marital status of the Respondents

TEVTA
Material Status Trained Percentage Informal Trained Percentage

Married 10 11% 60 67%

Unmarried 80 89% 30 33%

38
 Total 90 100% 90 100%
Source: Author’s own calculations

90
80
70
60
50
Tevta Trained
40
Infromal Trained
30
20
10
0
Married Unmarried

4.1.3 Social status and family size of the Respondent

The future of the world depends upon the education and training of the present generation. The
people belong to rich families are more likely to succeed in life than the poor families (Mayer, 2010).
With large family size the parents face difficulties in providing them better education and other
necessities of life. Family size or number of people in the household was categorizing into four groups.
The first group consists of 4 and below family members, second consist of 5-6 family members, third
consist of 7-8 family members and the fourth consist of 9-10 family members, fifth consist of 10-11
family members and sixth consist of above 12 family members . The table shows that range of 4 and
below consist of 1 and 0 family members were belong to Informal trained and TEVTA trained
respectively and their percentage were 1% and 0% respectively. The group 5-6 consist of 25 and 21

39
family members were belong to Informal trained and TEVTA trained respectively and their percentage
were 28% and 23% respectively. The group 7-8 consist of 36 and 29 family members were belong to
Informal trained and TEVTA trained respectively and their percentage were 40% and 32% respectively.
The group 9-10 consist of 20 and 28 family members were belong to Informal trained and TEVTA
trained respectively and their percentage were 22% and 31% respectively. The group 11-12 consist of
8 and 12 family members were belong to Informal trained and TEVTA trained respectively and their
percentage were 9% and 13% respectively.

Table 4.1.3 Social status and family size of the Respondent

Family Informal TEVTA

Member Trained Percentage Trained Percentage
4 and Below 1 1% 0 0%
(5-6) 25 28% 21 23%
(7-8) 36 40% 29 32%
(9-10) 20 22% 28 31%
(11-12) 8 9% 12 13%
Above 12 0 0% 0 0%
Total 90 100% 90 100%
Source: Author’s own calculations

40
 40

35

30

25

20 Infromal Trained
Tevta Trained

15

10

0
4 and Below (5-6) (7-8) (9-10) (11-12) Above 12

4.1.4 Migration status of the Respondents

The TEVTA Trained 40 respondents migrated to cities and 50 respondents were non migrated, they
lived in villages, towns around the Faisalabad. Migration percentage of TEVTA respondents was 44%
and non migration percentage was 50. On the other hand informal trained respondent 63 were
migrated and 27 respondents were non migrated. Their percentages were 70% and 30 % migrated and
non migrated respectively. All Non Migrated respondent daily came from their house to their
employer shops, own shops etc.

Table 4.1.4 Migration status of the Respondents

41
Background TEVTA Trained Percentage Informal Trained Percentage

Migerated 40 44% 63 70%

Non Migerated 50 56% 27 30%

Total 90 100% 90 100%

Source: Author’s own calculations

70

60

50

40

Migerated
Non Migerated
30

20

10

0
Tevta Trained Infromal Trained

42
4.1.5 Time of Migration in years status of the Respondents

The TEVTA Trained 12 respondents and 9 informal trained respondents migrated to cities in 1-5 years
and their percentage was 10% and 13% respectively. TEVTA Trained 14 respondents and 27 informal
trained respondents migrated to cities in 6-10 years and their percentage was 16% and 30%
respectively. TEVTA Trained 10 respondents and 15 informal trained respondents migrated to cities in
11-15 years and their percentage was 11% and 17% respectively. TEVTA Trained 4 respondents and 6
informal trained respondents migrated to cities in 16-20 years and their percentage was 4% and 7%
respectively. 6 Informal trained respondents migrated to cities in more than 20 years and their
percentage was 7%.

Table 4.1.5 Time of Migration in years status of the Respondents

Time of Migration Informal Trained Percentage TEVTA Trained Percentage

1-5 years 9 10% 12 13%
6-10 years 27 30% 14 16%
11-15 Years 15 17% 10 11%
16-20 years 6 7% 4 4%
Above 20 Years 6 7% 0 0%
Total 90 100% 90 100%
Source: Author’s own calculations

43
 30

25

20

15 Infromal Trained
Tevta Trained
10

0
1-5 years 6-10 years 11-15 16-20 Above 20
Years years Years

4.1.6 Social status and education of the households

Education is crucial for a healthy economic growth. Male literacy rate is higher than female in
Pakistan. Due to low literacy rate and people have low awareness about good quality of drinking
water (Nasir and Nasli, 2010). Education plays an important role to aware people about working
skills, productivity, and income pattern. The table indicates the TEVTA Trained 28 respondents
and 28 informal trained respondents had 8 years of education and their percentage was 31% and
31% respectively. TEVTA Trained 46 respondents and 34 informal trained respondents had 10
years of education and their percentage was 51% and 34% respectively. TEVTA Trained 15
respondents and 22 informal trained respondents had 12 years of education and their percentage
was 17% and 24% respectively. TEVTA Trained 1 respondent and 5 informal trained respondents
had 12 years of education and their percentage was 1% and 6% respectively. Therefore TEVTA
trained respondent had avg. 10 years of education but informal trained respondent had more than
10 years of education.

Table 4.1.6 Social status and education of the households

TEVTA
Education Informal Trained Percentage Trained Percentage

8 Years 28 31% 28 31%

44
 10 years 34 38% 46 51%

12 Years 22 24% 15 17%

14 Year 5 6% 1 1%

Above 14 1 1% 0 0%

Total 90 100% 90 100%

Source: Author’s own calculations

50

45

40

35

30

25 Infromal Trained
Tevta Trained
20

15

10

0
8 Years 10 years 12 Years 14 Year Above 14

4.1.7 Main occupation status of the Respondents

45
Job status is play very important role in the overall development of the society. With poor
education and technical training many people were doing non-technical job that yield low income
(McCracken et al., 2015). In the survey, respondents were asked their main occupation and sources
of income. Main occupation and sources of income is the extremely concerned with the
productivity and efficiency. TEVTA Trained 29 respondents and 30 informal trained respondents
were Electricians and their percentage was 32% and 33% respectively. TEVTA Trained 30
respondents and 30 informal trained respondents were Plumber and their percentage was 33% and
33% respectively. TEVTA Trained 31 respondents and 30 informal trained respondents were
Motorbike Mechanics and their percentage was 34% and 33% respectively.

Table 4.1.7 Main occupation status of the Respondents

Informal TEVTA
Skills and Major Occupation Trained Percentage Trained Percentage

Electrician 30 33% 29 32%

Plumber 30 33% 30 33%

Motor Bike Mechanic 30 33% 31 34%

Total 90 100% 90 100%

Source: Author’s own calculations

46
 31.5

31

30.5

30
Infromal Trained

29.5 Tevta Trained

29

28.5

28
Electrician Plumber Motor Bike Mechanic

4.1.8 Professional status of the Respondents

In the survey, respondents were asked their professional status. Main profession and sources of
income is the extremely concerned with the productivity and efficiency. TEVTA Trained 29
respondents and 17 informal trained respondents were Expert Electricians and their percentage was
32% and 19% respectively. TEVTA Trained 30 respondents and 20 informal trained respondents
were Plumber and their percentage was 33% and 22% respectively. TEVTA Trained 31
respondents and 14 informal trained respondents were Expert Motorbike Mechanics and their
percentage was 34% and 16% respectively. Further in Informal Trained respondents 2 were helper
mechanic and 3 were helper electricians. 13 senior mechanic, 1 junior mechanic, 10 junior
electricians and 10 junior plumbers. Most of all in TEVTA Trained respondents were experts more
than informal trained respondents.

47
Table 4.1.8 Professional status of the Respondents

TEVTA
Professional Status Informal Trained Percentage Trained Percentage

Expert Motorcycle Mechanic 14 16% 31 34%

Expert Electrician 17 19% 29 32%

Expert Plumber 20 22% 30 33%

Helper Mechanic 2 2% 0 0%

Helper Plumer 0 0% 0 0%

Helper Electrician 3 3% 0 0%

Seniour Mechanic 13 14% 0 0%

Junior Mechanic 1 1% 0 0%

Junior Electrician 10 11% 0 0%

Junior Plumber 10 11% 0 0%

Total 90 100% 90 100%

Source: Author’s own calculations

48
 35

30

25

20

15 Infromal Trained
Tevta Trained

10

4.1.9 Employed and Self Employed status of the Respondents

49
TEVTA Trained47 respondents and 45 informal trained respondents were employed their
percentage was 52% and 50% respectively. TEVTA Trained 43 respondents and 45 informal
trained respondents were self employed and their percentage was 48% and 50% respectively.

Table 4.1.9 Employed and Self Employed status of the Respondents

Respondent TEVTA Trained Percentage Informal Trained Percentage

Employed 47 52% 45 50%

Self Emplyed 43 48% 45 50%

Total 90 100% 90 100%

Source: Author’s own calculations

48

47

46

45
Employed

44 Self Emplyed

43

42

41
Tevta Trained Infromal Trained

4.1.10 Getting job status of the employed Respondents

50
TEVTA Trained 32 respondents got job with the reference of TEVTA and 15 respondents got their
job by themselves efforts, their percentage was 68% and 32% respectively. On the other hand
informal45 respondents got jobs by references.

Table 4.1.10 Getting job status of the employed Respondents

TEVTA
Getting job on the behalf of Informal Trained Percentage Trained Percentage

TEVTA 0 0% 32 68%

Self 0 0% 15 32%

Reffernce 45 100% 0 0%

Other 0 0% 0 0%

Total 45 100% 47 100%

Source: Author’s own calculations

50

45

40

35

30

25 Infromal Trained
Tevta Trained
20

15

10

0
Tevta Self Reffernce Other

4.1.11 Getting job duration of TEVTA trained employed Respondents

51
TEVTA Trained 10 respondents got job immediately after diploma course with the reference of
TEVTA with 21%. TEVTA Trained 21 respondents got job in 1-2 months after diploma course
with the reference of TEVTA with 45%. TEVTA Trained 9 respondents got job in 3-4 months after
diploma course with the reference of TEVTA with 19%. TEVTA Trained 7 respondents got job in
5-6 months after diploma course with the reference of TEVTA with 15%.

Table 4.1.11 Getting job duration of TEVTA trained employed Respondents

TEVTA
Duration of getting job after completion of Course in Months Trained Percentage

Immediately 10 21%

1-2 Month 21 45%

3-4 Month 9 19%

5-6 Month 7 15%

Total 47 100%
Source: Author’s own calculations

Tevta Trained
25

20

15

Tevta Trained
10

0
Immigately 1-2 Month 3-4 Month 5-6 Month

52
4.1.12 Employed respondents starting salary status
TEVTA Trained 21 respondents and 45 informal trained respondents were got salary 10000 and
under 10000 with percentage 48% and 100% respectively. TEVTA Trained 22 respondents and
were got salary 10001-20000 with 50%. TEVTA Trained 2 respondents and were got salary 20001-
30000 with 5%. TEVTA Trained 5 respondents and were got salary 30001-40000 with 5%.
Therefore TEVTA trained respondent got higher salaries than informal trained respondents.

Table 4.1.12 Employed respondents starting salary status

Informal TEVTA
Starting Salary Employed Trained Percentage Trained Percentage

10000 and Under 45 100% 21 48%

10001-20000 0 0% 22 50%

20001-30000 0 0% 2 5%

30001-40000 0 0% 2 5%

Total 45 100% 47 100%

Source: Author’s own calculations

50
45
40
35
30
25 Infromal Trained

20 Tevta Trained

15
10
5
0
10000 and Under 10001-20000 20001-30000 30001-40000

4.1.13 Employed respondents current salary status

53
TEVTA Trained 8 respondents and 34 informal trained respondents were got salary 10000 and
under 10000 with percentage 17% and 76% respectively. TEVTA Trained 27respondents and 11
informal trained respondents were got salary range 10001- 20000 with percentage 57% and 24%
respectively. TEVTA Trained 8 respondents were got salary range 20001- 30000 with percentage
17. TEVTA Trained 1 respondent was got salary 30001-40000 with 2%. TEVTA Trained 3
respondents were got salary 40001-50000 with 6% Therefore TEVTA trained respondent got
higher salaries than informal trained respondents.

Table 4.1.13 Employed respondents current salary status

TEVTA
Current Salary Employed Trained Percentage Informal Trained Percentage

10000 and Under 8 17% 34 76%

10001-20000 27 57% 11 24%

20001-30000 8 17% 0 0%

30001-40000 1 2% 0 0%

40001-50000 3 6% 0 0%

Total 47 100% 45 100%

Source: Author’s own calculations

54
 40

35

30

25

20 Tevta Trained
Infromal Trained

15

10

0
10000 and 10001-20000 20001-30000 30001-40000 40001-50000
Under

4.1.14 Average working hours per day status of Respondents

55
TEVTA Trained 5 respondents and 1 informal trained respondent were had worked 8 Hrs per days
with 6% and 1% respectively. TEVTA Trained 4 respondents and 4 informal trained respondent
were had worked 9 Hrs per days with 4% and 4% respectively. TEVTA Trained 29 respondents
and 35 informal trained respondent were had worked 10 Hrs per days with 32% and 39%
respectively. TEVTA Trained 23 respondents and 20 informal trained respondent were had worked
11 Hrs per days with 26% and 22% respectively. TEVTA Trained 29 respondents and 30 informal
trained respondent were had worked 12 Hrs per days with 32% and 33% respectively. Therefore
Informal Trained Respondent had worked more hours per day as compare to TEVTA trained
respondents.

Table 4.1.14 Average working hours per day status of Respondents

Avg. working hours per Informal TEVTA

day Trained Percentage Trained Percentage

8 Hrs 1 1% 5 6%

9 Hrs 4 4% 4 4%

10 Hrs 35 39% 29 32%

11 Hrs 20 22% 23 26%

12 Hrs 30 33% 29 32%

Total 90 100% 90 100%

Source: Author’s own calculations

56
 40

35

30

25

20 Infromal Trained
Tevta Trained

15

10

0
8 Hrs 9 Hrs 10 Hrs 11 Hrs 12 Hrs

4.1.15 Starting designation status of employed Respondents

57
TEVTA Trained 12 respondents as Electrician, 17 respondents as Plumber and 18 respondents as
Motorbike appointed in starting with 26% , 36% and 38% respectively. On the other hand Informal
Trained 15 respondents as helper Electrician, 15 respondents as helper Plumber and 15 respondents
as helper Motorbike mechanic appointed in starting with 33% , 33% and 33% respectively.

Table 4.1.15 Starting designation status of employed Respondents

Informal TEVTA
Starting Designation Employed Trained Percentage Trained Percentage
Electrician 0 0% 12 26%
Plumber 0 0% 17 36%
Motor Bike Mechanic 0 0% 18 38%
Helper Electrician 15 33% 0 0%
Helper Plumber 15 33% 0 0%
Helper Motor Bike Mechanic 15 33% 0 0%
Total 45 100% 47 100%
Source: Author’s own calculations

20
18
16
14
12
10
Infromal Trained
8
Tevta Trained
6
4
2
0
Electrician Plumber Motor Bike Helper Helper Helper Motor
Mechanic Electrician Plumber Bike
Mechanic

4.1.16 Current designation status of employed Respondents

58
TEVTA Trained 12 respondents as Expert Electrician, 17 respondents as Expert Plumber and 18
Expert respondents as Motorbike had currently status with 26% , 36% and 38% respectively. On
the other hand Informal Trained 2 respondents as Expert Electrician, 4 respondents as Expert
Plumber and 6 Expert respondents as Motorbike had currently status with 4% , 9% and 31%
respectively. And other remaining respondent of informal trained had following status.

Table 4.1.16 Current designation status of employed Respondents

TEVTA
Current Designation Informal Trained Percentage Trained Percentage

Expert Motorcycle Mechanic 6 13% 12 26%

Expert Electrician 2 4% 17 36%

Expert Plumber 4 9% 18 38%

Helper Mechanic 1 2% 0 0%

Helper Plumer 1 2% 0 0%

Helper Electrician 3 7% 0 0%

Seniour Mechanic 8 18% 0 0%

Junior Mechanic 0 0% 0 0%

Junior Electrician 10 22% 0 0%

Junior Plumber 10 22% 0 0%

Total 45 100% 47 100%

Source: Author’s own calculations

59
 20

18

16

14

12

10

8 Infromal Trained
Tevta Trained

4.1.17 Expected designation status desire by employed Respondents

Both TEVTA Trained and Informal Trained respondents were wanted to be master expert in their
fields.

4.1.17 Expected designation status desire by employed Respondents

60
 Informal TEVTA
Expected Designation Trained Percentage Trained Percentage

Master Expert Motorcycle Mechanic 15 33% 12 26%

Master Expert Electrician 15 33% 17 36%

Master Expert Plumber and Fitter 15 33% 18 38%

Total 45 100% 47 100%

Source: Author’s own calculations

20

18

16

14

12

10 Infromal Trained
Tevta Trained
8

0
Master Expert Motorcycle Master Expert Electrician Master Expert Plumber and
Mechanic Fitter

4.1.18 Annual increment of employed Respondents

61
TEVTA Trained 3 respondents and 18 informal trained respondent had Rs.1000 increment per year
with 6% and 40% respectively. TEVTA Trained 31 respondents and 27 informal trained
respondents had Rs.1000 - 2000 increment per year with 66% and 60% respectively. TEVTA
Trained 7 respondents had Rs.2001-3000 increment per year with 15%. TEVTA Trained 2
respondents had Rs.3001-4000 increment per year with 4%. TEVTA Trained Respondent had got
more increment as compare to Informal trained respondents.

Table 4.1.18 Annual increment of employed Respondents

TEVTA
Annual Increment Informal Trained Percentage Trained Percentage
Under 1000 18 40% 3 6%
1000-2000 27 60% 31 66%
2001-3000 0 0% 7 15%
3001-4000 0 0% 2 4%
4001-5000 0 0% 4 9%

Total 45 100% 47 100%

Source: Author’s own calculations

35

30

25

20
Infromal Trained
15 Tevta Trained

10

0
Under 1000 1000-2000 2001-3000 3001-4000 4001-5000

4.1.19 Times of Promotion per year of employed Respondents

62
TEVTA Trained 33 respondents and 38 informal trained respondent had promoted one time in a
year with 70% and 84% respectively. TEVTA Trained 14 respondents and 5 informal trained
respondents had promoted two times in a year with 30% and 11% respectively.

Table 4.1.19 Times of Promotion per year of employed Respondents

Informal TEVTA
Time of Promotion per year Trained Percentage Trained Percentage

Not promoted 2 4% 0 0%

One time in year 38 84% 33 70%

Two time in year 5 11% 14 30%

Total 45 100% 47 100%

Source: Author’s own calculations

40

35

30

25

20 Infromal Trained
Tevta Trained

15

10

0
Not promoted One time in year Two time in year

4.1.20 Total Work Experience of Respondents

63
TEVTA Trained 44 respondents and 31 informal trained respondent had 1-5 years experience with
49% and 34% respectively. TEVTA Trained 22 respondents and 33 informal trained respondents
had 6-10 years experience with 24% and 33% respectively. 33 informal trained respondents had
16-20 years experience with 8%. Therefore informal Trained had more working experience than
TEVTA Trained Respondent.

Table 4.1.20 Total Work Experience of Respondents

Informal TEVTA
Total Experience in Year Trained Percentage Trained Percentage

under One Year 0 0% 1 1%

1-5 Years 31 34% 44 49%

6-10 Years 33 37% 22 24%

11-15 Years 17 19% 23 26%

16-20 Years 7 8% 0 0%

21-25 Years 2 2% 0 0%

Total 90 100% 90 100%

Source: Author’s own calculations

50
45
40
35
30
25 Infromal Trained
20 Tevta Trained
15
10
5
0
under One 1-5 Years 6-10 Years 11-15 Years 16-20 Years 21-25 Years
Year

64
4.1.20 Stipend per month Respondents
TEVTA Trained 61 respondents got Rs. 1000 stipend per month during diploma and 29
respondents received Rs. 1500 stipend per month from TEVTA. But Informal Trained Respondent
did not get any stipend from their masters or employers.

Table 4.1.20 Stipend per month Respondents

TEVTA Informal
Any Stepend in Month Trained Percentage Trained Percentage

Rupees 1000 61 68% 0 0%

Rupees 1500 29 32% 0 0%

Total 90 100% 0 0%
Source: Author’s own calculations

70

60

50

40
Rupees 1000
30 Rupees 1500

20

10

0
Tevta Trained Infromal Trained

65
4.1.21 Social status and income of the Respondents
Income plays an important role to consume safe drinking water. With poor education and technical
training many people were doing non-technical job that yield low income (McCracken et al.,
2015). Respondent,s income basically shows their productivity. TEVTA Trained 10 respondents
and 27 informal trained respondents had monthly income under 10000 and equal to 10000 with
30% and 11% respectively. TEVTA Trained 52 respondents and 48 informal trained respondent
had monthly income range 10001-20000 with 58% and 53% respectively. TEVTA Trained 21
respondents and 13 informal trained respondents had monthly income range 20001-30000 with
23% and 14% respectively. TEVTA Trained 4 respondents and 2 informal trained respondents had
monthly income range 30001-40000 with 4% and 2% respectively. Therefore TEVTA Trained
Respondent had earned more income than informal Trained respondents.

Table 4.1.21 Social status and income of the Respondents

Total Income per TEVTA Informal

month Trained Percentage Trained Percentage

10000 and Under 10 11% 27 30%

10001-20000 52 58% 48 53%

20001-30000 21 23% 13 14%

30001-40000 4 4% 2 2%

40001-50000 3 3% 0 0%

Total 90 100% 90 100%

Source: Author’s own calculations

66
 60

50

40

30 Tevta Trained
Infromal Trained

20

10

0
10000 and Under 10001-20000 20001-30000 30001-40000 40001-50000

4.1.22 Learning duration of skills of the Respondents

67
TEVTA Trained 90 respondents got skills in 6 months and 3 Informal trained respondents only got
skills in 6 month. Majority of informal trained respondents got skills in 7-12 months.

Table 4.1.22 Learning duration of skills of the Respondents

Learning Duration in Informal TEVTA

months Trained Percentage Trained Percentage

0-6 Months 3 3% 90 100%

7-12 Months 68 76% 0 0%

13-18 Months 19 21% 0 0%

Total 90 100% 90 100%

Source: Author’s own calculations

100
90
80
70
60
50 Infromal Trained

40 Tevta Trained

30
20
10
0
0-6 Months 7-12 Months 13-18 Months

68
4.1.23 Detail status from where Respondents got skills
TEVTA Trained 90 respondents got skills from TEVTA Informal trained respondents got skills
from masters and their employers.

Table 4.1.23 Detail status from where Respondents got skills

TEVTA
From where learnt Skills Informal Trained Percentage Trained Percentage

Master 47 52% 0 0%

Employer 43 48% 0 0%

TEVTA 0 0% 90 100%

Total 90 100% 90 100%

Source: Author’s own calculations

100
90
80
70
60
50 Infromal Trained

40 Tevta Trained

30
20
10
0
Master Employer Tevta

4.2 Estimation of Technical Efficiency

69
Input oriented DEA model under the assumption of variable return to scale was used to estimate
the technical efficiency in this study. Coelli, et al. (1998) argued that one should select orientation
from input oriented DEA model or output oriented DEA model according to which quantities the
operator has more control over.

As, farmers in Punjab have more control over inputs than outputs, therefore, input oriented DEA
model was used in the study. Constant return to scale DEA model is only appropriated when all
firms are operating at optimal scale (Coelli, et al. 1998) but it is not possible in agriculture in
Pakistan due to many constraints such as financial constrains, imperfect competition etc. In order to
accommodate this possibility, Output variable used for estimating technical efficiency was total
productivity farm income (Y).. The inputs used in this study included land (X1), Learning duration
of skills (X2), Working experiences (X3), Education (X4), Avg Working hours

Following Coelli, et al. (1998), an input oriented variable return to scale DEA model for estimation
of technical efficiency was specified as:
Min θ,λ θ,
Subject to -yi + Yλ ≥ 0
θxi - Xλ ≥ 0
N1/ λ = 1
λ≥0
where
Y represents an output matrix for T.E of Respondents.
θ represents the input technical efficiency score having
a value 0 ≤ θ ≤ 1.
X represents an input matrix for Respondents learning duration. λ is an NX1 vector of Avg working
hours weights which defines the linear combination of the peers of i-th farm yi
represents the total farm income of the respondents

In Deap Software using Learning duration of skills as input and income, education, experiences as
outputs. The Technical efficiency is as following…
70
TEVTA Trained 4 respondents had technical efficiency range of 0.61-0.70 from the TEVTA
respondents efficiency starts which is very high as compare to informal trained respondents.
TEVTA Trained 26 respondents had technical efficiency range of 0.71-0.80. TEVTA Trained 34
respondents had technical efficiency range of 0.81-0.90 and TEVTA Trained 26 respondents had
technical efficiency range of 0.91-1. On the other hand Informal trained respondents maximum
range occupy in 0.21-0.30.
Table 4.2 Detail of Technical Efficiency

TEVTA
Technical Efficiency Informal Trained Percentage Trained Percentage

0.01 – 0.10 1 1% 0 0%

0.11 – 0.20 7 8% 0 0%

0.21 – 0.30 36 40% 0 0%

0.31 – 0.40 15 17% 0 0%

0.41 – 0.50 12 13% 0 0%

0.51 – 0.60 9 10% 0 0%

0.61 – 0.70 3 3% 4 4%

0.71 – 0.80 2 2% 26 29%

0.81 – 0.90 1 1% 34 38%

0.91 – 0.10 4 4% 26 29%

Total 90 100% 90 100%

Source: Author’s own calculations

71
 40

35

30

25

20 Infromal Trained
Tevta Trained

15

10

0
0.01 – 0.11 – 0.21 – 0.31 – 0.41 – 0.51 – 0.61 – 0.71 – 0.81 – 0.91 –
0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 0.10

4.3.1 Tobit Model for Informal Trained respondents

72
Using Technical efficiency as depend variable and income, learning duration , experience,
education, age and avg working hours as independent variables. The below table show the result of
informal trained respondents.

Table 4.3.1 Tobit Model for Informal Trained respondents

z-
Variable Coefficient Std. Error Statistic Prob.

T_INCOME -0.00000962 0.0000034 -2.83013 0.0047

L_D 0.026928 0.002814 9.569848 0

-
EXPERIENCE -0.011541 0.004768 2.420306 0.0155
-
EDU -0.003358 0.005267 0.637528 0.5238
-
AGE -0.001941 0.003316 0.585457 0.5582

A_W_R 0.017062 0.011458 1.489152 0.1364

C 0.222864 0.146731 1.518856 0.1288

73
4.3.2 Tobit Model for TEVTA Trained respondents

Using Technical efficiency as depend variable and income, experience, education, age and avg
working hours as independent variables. The below table show the result of informal trained
respondents.

Table 4.3.2 Tobit Model for TEVTA Trained respondents

Variable Coefficient Std. Error z-Statistic Prob.

T_INCOME -2.71E-06 5.37E-07 -5.05289 0

EXPERIENCE -0.005274 0.002458 -2.14608 0.032

EDU 0.002432 0.003014 0.806867 0.42

AGE -0.029714 0.00148 -20.0789 0

A_W_R 0.002843 0.003805 0.747246 0.455

C 1.4847 0.058419 25.41462 0

74
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