IDEAS home Printed from https://ideas.repec.org/a/eee/enepol/v44y2012icp140-152.html
   My bibliography  Save this article

Efficiency analysis of world cement industry in presence of undesirable output: Application of data envelopment analysis and directional distance function

Author

Listed:
  • Riccardi, R.
  • Oggioni, G.
  • Toninelli, R.

Abstract

CO2 emissions reduction and energy efficiency improvement are the targets of many environmental policies that aim at tackling climate change. The European Emission Trading is the best example of this engagement against climate change. Considering this framework, this paper studies the efficiency of the high energetic and CO2 emissions intensive cement production process in 21 world countries. Alternative formulations of standard data envelopment analysis models and a directional distance function approach are compared in order to detect the efficiency of the cement sector both in presence and in absence of carbon emissions. We first analyze the entire cement production process and we then concentrate on the production of clinker, a by-product of cement, that is the main responsible of CO2 emissions. Our results show that the inclusion or the exclusion of undesirable factors (CO2) influence efficiency levels as well as the investments in new technologies and the utilization of alternative fuels and raw materials in the cement and clinker production processes.

Suggested Citation

  • Riccardi, R. & Oggioni, G. & Toninelli, R., 2012. "Efficiency analysis of world cement industry in presence of undesirable output: Application of data envelopment analysis and directional distance function," Energy Policy, Elsevier, vol. 44(C), pages 140-152.
    • Handle: RePEc:eee:enepol:v:44:y:2012:i:c:p:140-152
    DOI: 10.1016/j.enpol.2012.01.030
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301421512000353
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.enpol.2012.01.030?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Mukherjee, Kankana, 2008. "Energy use efficiency in the Indian manufacturing sector: An interstate analysis," Energy Policy, Elsevier, vol. 36(2), pages 662-672, February.
    2. Henry Tulkens & Philippe Eeckaut, 2006. "Non-Frontier Measures of Efficiency, Progress and Regress for Time Series Data," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 373-394, Springer.
    3. Jean Pierre Ponssard & Neil Walker, 2008. "EU emissions trading and the cement sector: a spatial competition analysis," Climate Policy, Taylor & Francis Journals, vol. 8(5), pages 467-493, September.
    4. Färe, Rolf & Grosskopf, Shawna & Pasurka, Carl A., 2007. "Environmental production functions and environmental directional distance functions," Energy, Elsevier, vol. 32(7), pages 1055-1066.
    5. Fare, R. & Grosskopf, S. & Hernandez-Sancho, F., 2004. "Environmental performance: an index number approach," Resource and Energy Economics, Elsevier, vol. 26(4), pages 343-352, December.
    6. Kumar Mandal, Sabuj & Madheswaran, S., 2010. "Environmental efficiency of the Indian cement industry: An interstate analysis," Energy Policy, Elsevier, vol. 38(2), pages 1108-1118, February.
    7. Picazo-Tadeo, Andres J. & Reig-Martinez, Ernest & Hernandez-Sancho, Francesc, 2005. "Directional distance functions and environmental regulation," Resource and Energy Economics, Elsevier, vol. 27(2), pages 131-142, June.
    8. Fare, Rolf & Grosskopf, Shawna & Tyteca, Daniel, 1996. "An activity analysis model of the environmental performance of firms--application to fossil-fuel-fired electric utilities," Ecological Economics, Elsevier, vol. 18(2), pages 161-175, August.
    9. Zofio, Jose L. & Prieto, Angel M., 2001. "Environmental efficiency and regulatory standards: the case of CO2 emissions from OECD industries," Resource and Energy Economics, Elsevier, vol. 23(1), pages 63-83, January.
    10. Secretariat, 2009. "Activities of JSCES in 2008–2009," The Journal of Comparative Economic Studies (JCES), The Japanese Society for Comparative Economic Studies (JSCES), vol. 5, pages 125-128, December.
    11. Zhou, P. & Ang, B.W. & Poh, K.L., 2008. "A survey of data envelopment analysis in energy and environmental studies," European Journal of Operational Research, Elsevier, vol. 189(1), pages 1-18, August.
    12. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    13. W. Liu & W. Meng & X. Li & D. Zhang, 2010. "DEA models with undesirable inputs and outputs," Annals of Operations Research, Springer, vol. 173(1), pages 177-194, January.
    14. Mandal, Sabuj Kumar, 2010. "Do undesirable output and environmental regulation matter in energy efficiency analysis? Evidence from Indian Cement Industry," Energy Policy, Elsevier, vol. 38(10), pages 6076-6083, October.
    15. Fare, Rolf & Grosskopf, Shawna, 2004. "Modeling undesirable factors in efficiency evaluation: Comment," European Journal of Operational Research, Elsevier, vol. 157(1), pages 242-245, August.
    16. Dutta, Monica & Mukherjee, Saptarshi, 2010. "An outlook into energy consumption in large scale industries in India: The cases of steel, aluminium and cement," Energy Policy, Elsevier, vol. 38(11), pages 7286-7298, November.
    17. Watanabe, Michio & Tanaka, Katsuya, 2007. "Efficiency analysis of Chinese industry: A directional distance function approach," Energy Policy, Elsevier, vol. 35(12), pages 6323-6331, December.
    18. Oggioni, G. & Riccardi, R. & Toninelli, R., 2011. "Eco-efficiency of the world cement industry: A data envelopment analysis," Energy Policy, Elsevier, vol. 39(5), pages 2842-2854, May.
    19. Wade D. Cook & Joe Zhu, 2007. "Data Irregularities And Structural Complexities In Dea," Springer Books, in: Joe Zhu & Wade D. Cook (ed.), Modeling Data Irregularities and Structural Complexities in Data Envelopment Analysis, chapter 0, pages 1-11, Springer.
    20. Mukherjee, Kankana, 2008. "Energy use efficiency in U.S. manufacturing: A nonparametric analysis," Energy Economics, Elsevier, vol. 30(1), pages 76-96, January.
    21. Daniel Tyteca, 1997. "Linear Programming Models for the Measurement of Environmental Performance of Firms—Concepts and Empirical Results," Journal of Productivity Analysis, Springer, vol. 8(2), pages 183-197, May.
    22. Sueyoshi, Toshiyuki & Goto, Mika, 2011. "DEA approach for unified efficiency measurement: Assessment of Japanese fossil fuel power generation," Energy Economics, Elsevier, vol. 33(2), pages 292-303, March.
    23. Zhou, P. & Ang, B.W. & Han, J.Y., 2010. "Total factor carbon emission performance: A Malmquist index analysis," Energy Economics, Elsevier, vol. 32(1), pages 194-201, January.
    24. Charnes, A. & Cooper, W. W. & Rhodes, E., 1979. "Measuring the efficiency of decision-making units," European Journal of Operational Research, Elsevier, vol. 3(4), pages 339-338, July.
    25. Zhou, P. & Ang, B.W. & Poh, K.L., 2008. "Measuring environmental performance under different environmental DEA technologies," Energy Economics, Elsevier, vol. 30(1), pages 1-14, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sueyoshi, Toshiyuki & Yuan, Yan & Goto, Mika, 2017. "A literature study for DEA applied to energy and environment," Energy Economics, Elsevier, vol. 62(C), pages 104-124.
    2. Oggioni, G. & Riccardi, R. & Toninelli, R., 2011. "Eco-efficiency of the world cement industry: A data envelopment analysis," Energy Policy, Elsevier, vol. 39(5), pages 2842-2854, May.
    3. Leleu, Hervé, 2013. "Shadow pricing of undesirable outputs in nonparametric analysis," European Journal of Operational Research, Elsevier, vol. 231(2), pages 474-480.
    4. Chen, Chien-Ming, 2013. "A critique of non-parametric efficiency analysis in energy economics studies," Energy Economics, Elsevier, vol. 38(C), pages 146-152.
    5. Falavigna, G. & Ippoliti, R., 2020. "The socio-economic planning of a community nurses programme in mountain areas: A Directional Distance Function approach," Socio-Economic Planning Sciences, Elsevier, vol. 71(C).
    6. Gómez-Calvet, Roberto & Conesa, David & Gómez-Calvet, Ana Rosa & Tortosa-Ausina, Emili, 2014. "Energy efficiency in the European Union: What can be learned from the joint application of directional distance functions and slacks-based measures?," Applied Energy, Elsevier, vol. 132(C), pages 137-154.
    7. George Halkos & George Papageorgiou, 2016. "Spatial environmental efficiency indicators in regional waste generation: a nonparametric approach," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 59(1), pages 62-78, January.
    8. Zhou, Haibo & Yang, Yi & Chen, Yao & Zhu, Joe, 2018. "Data envelopment analysis application in sustainability: The origins, development and future directions," European Journal of Operational Research, Elsevier, vol. 264(1), pages 1-16.
    9. Li, Ming-Jia & Tao, Wen-Quan, 2017. "Review of methodologies and polices for evaluation of energy efficiency in high energy-consuming industry," Applied Energy, Elsevier, vol. 187(C), pages 203-215.
    10. Mardani, Abbas & Zavadskas, Edmundas Kazimieras & Streimikiene, Dalia & Jusoh, Ahmad & Khoshnoudi, Masoumeh, 2017. "A comprehensive review of data envelopment analysis (DEA) approach in energy efficiency," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 1298-1322.
    11. Feng, Chenpeng & Chu, Feng & Ding, Jingjing & Bi, Gongbing & Liang, Liang, 2015. "Carbon Emissions Abatement (CEA) allocation and compensation schemes based on DEA," Omega, Elsevier, vol. 53(C), pages 78-89.
    12. Ramli, Noor Asiah & Munisamy, Susila, 2015. "Eco-efficiency in greenhouse emissions among manufacturing industries: A range adjusted measure," Economic Modelling, Elsevier, vol. 47(C), pages 219-227.
    13. Zhou, P. & Ang, B.W. & Wang, H., 2012. "Energy and CO2 emission performance in electricity generation: A non-radial directional distance function approach," European Journal of Operational Research, Elsevier, vol. 221(3), pages 625-635.
    14. Jie Wu & Xiang Lu & Dong Guo & Liang Liang, 2017. "Slacks-Based Efficiency Measurements with Undesirable Outputs in Data Envelopment Analysis," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 16(04), pages 1005-1021, July.
    15. Halkos, George E. & Tzeremes, Nickolaos G., 2013. "A conditional directional distance function approach for measuring regional environmental efficiency: Evidence from UK regions," European Journal of Operational Research, Elsevier, vol. 227(1), pages 182-189.
    16. Charles, Vincent & Kumar, Mukesh & Irene Kavitha, S., 2012. "Measuring the efficiency of assembled printed circuit boards with undesirable outputs using data envelopment analysis," International Journal of Production Economics, Elsevier, vol. 136(1), pages 194-206.
    17. Zhou, P. & Ang, B.W. & Poh, K.L., 2008. "A survey of data envelopment analysis in energy and environmental studies," European Journal of Operational Research, Elsevier, vol. 189(1), pages 1-18, August.
    18. Zhou, Guanghui & Chung, William & Zhang, Xiliang, 2013. "A study of carbon dioxide emissions performance of China's transport sector," Energy, Elsevier, vol. 50(C), pages 302-314.
    19. Tsolas, Ioannis E., 2011. "Performance assessment of mining operations using nonparametric production analysis: A bootstrapping approach in DEA," Resources Policy, Elsevier, vol. 36(2), pages 159-167, June.
    20. George Halkos & Nickolaos Tzeremes, 2013. "National culture and eco-efficiency: an application of conditional partial nonparametric frontiers," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 15(4), pages 423-441, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:44:y:2012:i:c:p:140-152. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/enpol .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.