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Application of the Nonparametric DEA Meta-frontier Approach with Undesirable Outputs in the Case of EU Regions

Author

Listed:
  • Hančlová Jana

    (VŠB-Technical University of Ostrava, Faculty of Economics, Czech Republic)

  • Melecký Lukáš

    (VŠB-Technical University of Ostrava, Faculty of Economics, Czech Republic)

Abstract

Background: The paper focusses on the efficiency evaluation of the EU-28 NUTS 2 regions production process according to the concept of the Regional Competitiveness Index 2013.Objectives: Production units are divided into four groups using the factors of regional competitiveness. Production technology also enables reduction of the undesirable outputs (a negative impact on health and long-term unemployment). Based on the analysis of distance of the production units from the efficiency frontiers, a directional output distance function assuming a constant return to scale is used. This approach thus respects the heterogeneity among the groups of regions.Methods/Approach: The nonparametric meta-frontier Data Envelopment Analysis approach was used in two steps. Firstly, the efficiency evaluation within each group of regions is provided and in the second step the meta-frontier is set down. For the measurement of the gap between the group-frontier and the meta-frontier, the technology gap ratios are provided. The paper also analyses environmental inefficiencies.Results: The obtained results indicate that a significant improvement of meta-technology ratio holds within the European context.Conclusions: The combination of empirical findings, with respect to technology gaps and environmental technology gaps, supports the evidence that traditional differences of technological frontiers formation are more significant in comparison to group frontiers constitution.

Suggested Citation

  • Hančlová Jana & Melecký Lukáš, 2016. "Application of the Nonparametric DEA Meta-frontier Approach with Undesirable Outputs in the Case of EU Regions," Business Systems Research, Sciendo, vol. 7(2), pages 65-77, September.
    • Handle: RePEc:bit:bsrysr:v:7:y:2016:i:2:p:65-77
    DOI: 10.1515/bsrj-2016-0013
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    References listed on IDEAS

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    More about this item

    Keywords

    competitiveness; directional distance function; efficiency; EU-28 regions; group-frontier; Regional Competitiveness Index 2013; meta-frontier; meta-technology ratio; technology gap inefficiency;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management

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