Advances in Management and Applied Economics

Applying Grey Relational Analysis to Find Interactions between Manufacturing and Logistics Industries in Taiwan

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  • Abstract

    The development of manufacturing and logistics industries is an important economic index and plays a significant role in developed countries. In Taiwan, both manufacturing and logistics industries have continuously developed in the past few decades, and their development has become interdependent. For instance, the transportation demand of manufacturing industries has an impact on the development of logistics industries. To effectively foster the development of these two sectors in Taiwan, it is necessary to identify the relationships between them. Grey relational analysis with an entropy calculation reveals some interesting findings. (1) The main manufacturing factor driving the logistics industry is employment compensation. (2) The main logistics factor driving the manufacturing sector is length of roads. (3) A fairly strong interaction exists between logistics and manufacturing industries.

    JEL classification numbers: C33, L60, L90
    Keywords: logistics, manufacturing, multiple criteria decision making, grey relational analysis, entropy.