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Assessing Eco-Efficiency in Asian and African Countries Using Stochastic Frontier Analysis

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  • Victor Moutinho

    (NECE—Research Center in Business Sciences, Management and Economics Department, University of Beira Interior, 6201-001 Covilhã, Portugal)

  • Mara Madaleno

    (GOVCOPP—Research Unit in Governance, Competitiveness and Public Policy, Department of Economics, Management, Industrial Engineering and Tourism (DEGEIT), Campus Universitário de Santiago, University of Aveiro, 3810-193 Aveiro, Portugal)

Abstract

This study aims to evaluate the economic and environmental efficiency of Asian and African economies. In the model proposed, Gross Domestic Product (GDP) is considered as the desired output and Greenhouse Gases (GHG), like carbon dioxide (CO 2 ) emissions, as the undesirable output. Capital, labor, fossil fuels, and renewable energy consumption are regarded as inputs, and the GDP/CO 2 ratio is the output, by using a log-linear Translog production function and using data from 2005 until 2018, including 22 Asian and 22 African countries. Results evidence cross-countries heterogeneity among production inputs, namely labor, capital, and type of energy use and its efficiency. The models complement each other and are based on different distributional assumptions and estimation methods while providing a picture of Eco-efficiency in Asian and African economies. Labor and renewable energy share increase technical Eco-efficiency, while fixed capital decreases it under time-variant models. Technical improvements in Eco-efficiency are verified through time considering the time variable into the model estimations, replacing fossil fuels with renewable sources. An inverted U-shaped Eco-efficiency function is found concerning the share of fossil fuel consumption. Important policy implications are drawn from the results regarding the empirical results.

Suggested Citation

  • Victor Moutinho & Mara Madaleno, 2021. "Assessing Eco-Efficiency in Asian and African Countries Using Stochastic Frontier Analysis," Energies, MDPI, vol. 14(4), pages 1-17, February.
    • Handle: RePEc:gam:jeners:v:14:y:2021:i:4:p:1168-:d:503793
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    6. Caleb I. Adewale & Elias Munezero & Elly K. Ndyomugyenyi & Basil Mugonola, 2024. "Determinants of technical efficiency of pig production systems in northern Uganda: a Stochastic Frontier approach," SN Business & Economics, Springer, vol. 4(8), pages 1-21, August.
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