This study evaluates the impact of privatization on the technical efficiency of six privatized enterprises,
three state-owned enterprises and six private enterprises competing in three oligopolistic manufacturing industries in
which privatization took place between 1984 and 1991 using panel data between 1970 and 1997. In our empirical
analysis, we employ the Data Envelopment Analysis (DEA) compute technical efficiency scores using the ‘intertemporal
frontier’ approach with panel data. The statistical analysis of variance shows that privatization in Malawi is associated
with high mean technical efficiency in privatized enterprises and competing state-owned enterprises and private
enterprises. If we account for other sources of technical efficiency, in the full sample we find evidence that the
competitive process is more important than privatization in increasing the technical efficiency of all enterprises
competing in the same industries. However, the results of the subsample of privatized enterprises show that
privatization significantly increases the technical efficiency of privatized enterprises, although we cannot ignore the role
of domestic competition, capital intensity, multinationality and structural adjustment programs as sources of technical
efficiency.