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An empirical study of comparing DEA and SFA methods to measure hospital units' efficiency

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  • George Katharakis
  • Maria Katharaki
  • Theofanis Katostaras

Abstract

The paper aims to examine the data envelopment analysis (DEA) and stochastic frontier analysis (SFA) results in order to facilitate a common understanding about the adequacy of these methods, defining any differences in healthcare efficiency estimation. A two-stage bootstrap DEA method and the Translog formula of the SFA were performed. Multi-inputs and multi-outputs were used in both of the approaches assuming two scenarios either including environmental variables or not. Thirty-two Greek public hospital units constitute the sample. DEA and SFA were found to yield divergent efficiency estimates due to many factors such as the nature of the environmental variables, the measurement error and other random factors. Environmental variables being hospital status and geographical position were found significantly correlating with inefficiency. The analysis concludes that the choice of the appropriate mathematical form depends on the expertise of the researcher and the purpose of the evaluation.

Suggested Citation

  • George Katharakis & Maria Katharaki & Theofanis Katostaras, 2014. "An empirical study of comparing DEA and SFA methods to measure hospital units' efficiency," International Journal of Operational Research, Inderscience Enterprises Ltd, vol. 21(3), pages 341-364.
    • Handle: RePEc:ids:ijores:v:21:y:2014:i:3:p:341-364
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    Citations

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    Cited by:

    1. Angeliki Flokou & Vassilis Aletras & Dimitris Niakas, 2017. "Decomposition of potential efficiency gains from hospital mergers in Greece," Health Care Management Science, Springer, vol. 20(4), pages 467-484, December.
    2. Yeşilyurt, M. Ensar & Şahin, Emre & Elbi, M. Doğan & Kızılkaya, Aydın & Koyuncuoğlu, M. Ulaş & Akbaş-Yeşilyurt, Filiz, 2021. "A novel method for computing single output for DEA with application in hospital efficiency," Socio-Economic Planning Sciences, Elsevier, vol. 76(C).
    3. Alliou S. Diarrassouba, 2021. "Inefficiency Factors in Basic Health Care Supply in Côte d’Ivoire: A Comparative Econometric Analysis," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 13(6), pages 1-46, June.
    4. Dong Tian & Fengtao Zhao & Weisong Mu & Radoslava Kanianska & Jianying Feng, 2016. "Environmental Efficiency of Chinese Open-Field Grape Production: An Evaluation Using Data Envelopment Analysis and Spatial Autocorrelation," Sustainability, MDPI, vol. 8(12), pages 1-13, November.

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