The Productivity Puzzle: An Evaluation of Entrepreneurial Efficiency in the MSME Sector
Abstract: This study evaluates entrepreneurial efficiency in the Micro, Small, and Medium Enterprise (MSME) sector by examining how effectively firms utilize financial, human, and operational resources to generate performance outcomes. Using a quantitative cross-sectional design, data were collected from 200 MSMEs through a structured survey, and Data Envelopment Analysis (DEA) was applied to estimate technical and scale efficiency. A second-stage Tobit regression was used to identify determinants of efficiency. The findings indicate considerable variation in efficiency performance, with many enterprises operating below optimal levels. Entrepreneur education, prior industry experience, digital adoption, formal business practices, and institutional support were positively associated with efficiency. The study highlights that improving managerial capability and strategic resource utilization may substantially enhance MSME performance. The findings offer practical implications for entrepreneurs and policymakers seeking targeted interventions to strengthen MSME competitiveness and sustainable growth.
Keywords: Entrepreneurial Efficiency, MSMEs, Data Envelopment Analysis, Technical Efficiency, Digital Adoption, Resource-Based View, Small Business Performance
How to Cite?: Pritam Mahapatra, "The Productivity Puzzle: An Evaluation of Entrepreneurial Efficiency in the MSME Sector", Volume 15 Issue 5, May 2026, International Journal of Science and Research (IJSR), Pages: 1266-1271, https://www.ijsr.net/getabstract.php?paperid=SR26519202718, DOI: https://dx.doi.org/10.21275/SR26519202718