Measuring inefficiency for specific inputs using data envelopment analysis: evidence from construction industry in Spain and Portugal
AbstractThis article contributes to the efficiency literature by defining, in the context of the data envelopment analysis framework, the directional distance function approach for measuring both technical and scale inefficiencies with regard to the use of individual inputs. The input-specific technical and scale inefficiencies are then aggregated in order to calculate the overall inefficiency measures. Empirical application focuses on a large dataset of Spanish and Portuguese construction companies between 2002 and 2010 and accounts for three inputs: materials, labor and fixed assets. The results show, first, that for both Spanish and Portuguese construction companies, fixed assets are the most technically inefficient input. Second, the most inefficient scale concerns the utilization of material input in both samples; the reason for this inefficiency is that firms tend to operate in the increasing returns to scale portion of technology set. Third, in both samples, large firms have the lowest input-specific technical inefficiencies, but the highest input-specific scale inefficiencies, compared to their small and mediumsized counterparts, and tend to suffer from decreasing returns to scale. Finally, in both samples, input-specific technical inefficiency under constant returns to scale increased during the period of the recent financial crisis, mainly due to the augmentation in scale inefficiency
|Journal series||Central European Journal of Operations Research, ISSN 1435-246X, e-ISSN 1613-9178, (A 20 pkt)|
|Publication size in sheets||1.15|
|Keywords in English||data envelopment analysis, input-specific inefficiency, directional distance function, construction industry|
|Publication indicators||= 2; = 2; : 2016 = 0.798; : 2017 = 0.73 (2) - 2017=0.948 (5)|
|Citation count*||5 (2020-01-19)|
* presented citation count is obtained through Internet information analysis and it is close to the number calculated by the Publish or Perish system.