Measuring Efficiency at the Regional Level: A Data Envelopment Analysis Approach

Purpose The purpose of this study is to: 1) develop a brand-new index of value for money (VFM) leveraging Data Envelopment Analysis (DEA) methodology: the “DEA VFM”; 2) validate the “DEA VFM” index; 3) compare the “DEA VFM” with the Booking.com VFM index, thus demonstrating the superiority of the proposed index for managerial decision-making. Design/methodology/approach PIM-DEA software was used to develop an input-oriented DEA model with one input (i.e. the median price) and six outputs (i.e. the standardized scores of cleanliness, staff, location, facilities, free Wi-Fi, comfort) on 613 Italian hotels. Both input and outputs are based on Booking.com data related to hotels located in four different popular destinations: Rome, Florence, Milan and Venice. Findings The authors developed and validated a new index of VFM based on DEA methodology: the “DEA VFM.” The DEA VFM shows a very low correlation with Booking VFM scores, and it demonstrates a superior performance when assessing hotels’ VFM. Booking VFM essentially measures perceived value rather than the relationship between price and value. Originality/value To the best of the authors’ knowledge, this is the only and first study in the hospitality management literature that develops and validates a new index of VFM based on the DEA methodology: the “DEA VFM”. Moreover, we demonstrate the superiority of the DEA VFM index on the Booking.com VFM.

This study aims to measure the relative efficiency of public sector spending (health, education, and the economy) and determine the effect of the relative efficiency of public sector spending (health, education, and economy) as well as GRDP per capita and the Open Unemployment Rate (TPT) as control variables on the Human Development index (HDI) and Inclusive Economic Development Index (IPEI) in the East Java region in 2016-2020. This study uses the Data Envelopment Analysis (DEA) method and panel data regression analysis. The results showed that Batu City, Mojokerto City, and Blitar City each consistently performed relatively efficiently in health, education, and economic spending during the 2016-2020 period. In this case, the efficiency of public sector spending is indeed needed in improving people's welfare. The government is expected to improve the allocation of public sector spending that is more oriented towards the quality of health, education, and basic public infrastructure so that it not only meets the quantity target but also the quality target.

The Italian educational system is strictly regulated by the Ministry of Education. However, there are strong differences in educational inputs and outputs among regions, as can be noticed by analysing the allocation of public budgets to the regions and their students' (average) performance in national and international test scores. A general institutional change is ongoing in Italy, that is, the decentralisation of competencies from the State to the regions (federalism). Some insights are necessary about the efficiency of public spending on education in a comparative perspective across regions. To estimate efficiency scores, a nonparametric technique called data envelopment analysis was used. The unit of analysis comprises the 18 Italian regions, with the focus on the lower secondary education. Then, a second‐stage Tobit regression was used to detect the factors affecting efficiency. The results corroborate the difference between the North and South of Italy (the regions in the North outperform their counterparts in the South). When looking at the regional socioeconomic context, gross domestic product per capita appears as the key determinant of efficiency. Copyright © 2012 John Wiley & Sons, Ltd.

Przedmiotem analizy w artykule jest udział administracji jednostek samorządu terytorialnego w prowadzeniu instytucji kultury. Na tle ogólnopolskim przeanalizowana została sytuacja w województwie podlaskim. Główne zagadnienia opracowania to zasady i metody finansowania instytucji kultury przez regionalny samorząd terytorialny oraz różne sposoby pozyskiwania przez instytucje kultury dodatkowego, pozabudżetowego dofinansowania ich działalności, szczególnie ze środków pochodzących z budżetu Ministerstwa Kultury i Dziedzictwa Narodowego oraz Unii Europejskiej.Autor wskazuje na zróżnicowanie przestrzenne, społeczne i finansowe związane z dostępem do wydarzeń kulturalnych i uczestnictwem w nich na przykładzie województwa podlaskiego. Postuluje większą profesjonalizację zarządzania instytucjami kultury na szczeblu województwa oraz prowadzenie prorozwojowej polityki kulturalnej przez jednostki samorządu terytorialnego. Akcentuje również konieczność aktywizowania lokalnych i regionalnych społeczności w związku z wydarzeniami kulturalnymi i współuczestniczenia mieszkańców w ich organizowaniu. Uczestnictwo w kulturze na poziomie lokalnym i regionalnym oraz rozważna polityka władz w tym zakresie są podstawą budowaniasilnych więzi społecznych i tożsamości regionalnej mieszkańców.

Summary The deepening of the Community has led to a crucial change in the position of the regional and local authorities in the overall structure. The most striking features of this new role of the subnational level are: •their increasing direct involvement and integration under general and specific Community policies;•their growing participation in the EC decision‐making process as a contribution to the elimination of the democratic deficit and to the achievement of greater closeness to the citizen within the framework of a subsidiary structure of the European Union;•the need, given the challenges posed by the internal market, for more regional and local initiative to help improve the quality of these levels as locations. How far the territorial authorities will be able to play this new, enlarged role will very much depend on the quality of their institutional infrastructure and their ability to take action. The comparative analysis reveals, however, that the tasks of the territorial authorities in the various member states differ significantly as regards their constitutional and democratic position. In many places regional and local authorities do not have enough independence (powers, financial resources). They are thus unable to respond adequately to the new requirements arising from deeper European integration. As there is also growing locational competition among the territorial authorities in the internal market, they need sufficient powers of their own to shape their economic future. Their ability to play an active part in the shaping of their own economic and social development against the background of their specific circumstances will very largely determine their future prospects in the internal market. The fact is, however, that central government occupies a dominant position in all policies relevant to the regions, especially in the least developed areas of the Community. This democratic deficit at regional and local level is an obstacle to the economic development of these regions. Almost half of the 175 NUTS II regions are today prepared for and capable of playing an active part within the European Union's institutional structure. The other EC regions do no more than enforce EC legislation applicable to them, without being able to influence the formulation and implementation of relevant Community policies. They lack the powers, organization, financial resources and, as a rule, administrative structures to play a democratically legitimized part in the formulation of European objectives. As a rule, they also fail to meet the requirements for democratic legitimized representation on the Committee of the Regions. Those who do not have a political mandate can hardly speak on behalf of a region's citizens. Administrative and political structures at regional and local level are underdeveloped, there are not enough opportunities for democratic decision‐making and employment of funds, and the flow of information, the external representation of interests and thus the efficiency of activities at regional level are inadequate. In many regions of Europe the organizational structure and decision‐making process no longer meet the new requirements arising from the internal market and the Treaty on European Union. Most member states of the Union do not consider it opportune to promote, encourage or tolerate independent initiatives and activities in the regions and municipalities. The majority of regions thus have little or no opportunity today to take the initiative themselves with a view to prompting endogenous developments. Centralism, the democratic deficit and the lack of regional powers are proving to be a major obstacle to development in the weakest regions of the EC. The Community should pay at least as much attention in the future to the removal of these handicaps as to a further increase in financial transfers to the weak regions. The differences in the powers and status of the territorial authorities are also highly significant in the context of the qualitative implementation of the subsidiarity principle in the European Union. Territorial authorities capable of taking action are crucial if solutions which are close to the citizen and have his approval are to be found when Community policies are formulated and implemented. This is particularly true of the EC structural policy. In these circumstances, the territorial authorities must also be integrated more closely into the Community decision‐making process. The Treaty on European Union takes an important step in the right direction by creating the Committee of the Regions (Articles 198a to 198c). The diversity and lack of comparability of the powers of the territorial authorities in the member states and the different images they have of themselves will not exactly facilitate the Committee's work. Through its work the European Parliament has made a decisive contribution by drawing the EC institutions’ attention to the importance of the regional and local authorities’ new role. A number of resolutions and the conferences of regional and local authorities it has organized give practical expression to its desire to do what it can to strengthen the territorial authorities in the Community context, while preserving its own privileges.

An understanding of what is happening at the regional and local level is crucial for understanding the dynamics of economic development in Ukraine. Enterprises are situated in local and regional economic complexes and have to deal with local and regional authorities. Previous chapters have repeatedly referred to the negative role local and regional authorities are playing by harassing enterprises, especially private ones. These authorities are playing an important role in perpetuating parasitic economic mechanisms by focusing their energies on lobbying for government support rather than furthering development potential in the region. In developed market economies, increasingly, coordination by networks, especially at the local and regional level, came to supplement coordination by the market and the state. Structures at the meso-level that furthered competition were also shaped by firms and other non-state organizations. Therefore it is topical to see to what extent in Ukraine governance mechanisms at the local and regional level have developed that may further economic development.KeywordsForeign Direct InvestmentCoal MineRegional EconomyRegional AuthoritySpecial Economic ZoneThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

This study aims to evaluate the efficiency of public sector spending on elementary education in India. Adopting a positivist philosophy, the research focuses on observable phenomena and employs a mono-method approach using quantitative analysis. It follows a deductive approach, aiming to test established theories and variables widely discussed in the existing literature. Given the strong correlation between public spending and educational outcomes, along with the varied educational achievements across Indian states, the study analyzes spending efficiency in sixteen major states. To achieve this, the study applies Data Envelopment Analysis (DEA) and the Malmquist Index to assess the efficiency of educational spending during the five years preceding and following the implementation of the Right to Education Act (RTE), 2010. The analysis compares DEA efficiency scores and Malmquist Index-based growth efficiency scores across the pre- and post-RTE periods. The findings indicate an overall improvement in spending efficiency, which rose from 83% to 93%. However, the Malmquist Index reveals a decline in the growth rate of efficiency—from 7.1% to 2.3%—suggesting that although efficiency improved, the rate of improvement has slowed. The primary objective of enhancing spending efficiency is to maximize educational outcomes. In the second part of the study, the influence of other variables—such as governance quality, maternal education, and school location (rural vs. urban)—on educational outcomes is examined. Regression analysis confirms the significant impact of governance, school location, and maternal education on educational performance in the Indian context. This study fills a critical research gap in several ways. It not only provides efficiency estimates for elementary education in India but also compares efficiency before and after the implementation of the RTE Act. It contributes to the existing literature by applying the Malmquist Index in conjunction with DEA, thereby capturing not just static efficiency levels but also the rate of change in efficiency over time. The use of the Malmquist Index represents a novel contribution to the Indian context, as earlier studies have not employed this method to estimate efficiency growth rates. Moreover, the study offers a practical framework for policymakers to assess spending from an efficiency standpoint. It further highlights the need to focus on governance quality, school location, and maternal education when analysing the reasons behind inter-state differences and below-par performance in educational outcomes.

This study examines the benefits of data envelopment analysis (DEA) in evaluating the performance of decision making units (DMUs). DEA is a mathematical programming tool applied in performance measurement. The problem identified is establishing business support units as value adding business units. A case is made for applying DEA when evaluating the performance of such business support units. To this end, a literature review of the results of applications of DEA to the evaluation of information technology and purchasing supply chain management functions was conducted. The findings indicate the benefits of DEA are that the method identifies efficient performers in a given population and, therefore, allows for benchmarking against the ’best in class’ performer. This as opposed to more commonly used parametric methods, such as regression analysis, which result in a comparator that represents the average performance for a given population, therefore, allowing only for measurement against the average. In addition, the findings indicate that in respect of business support units, the DEA methodology allows for the incorporation of intermediate outcomes, which facilitates the measurement of the contribution of these units to overall company performance. Although the DEA methodology has been widely applied, it is still not as well known or generally applied as the more common approaches. The recommendations made in this paper will be beneficial in bringing DEA to the attention of decision-makers. The recommendations will also raise awareness of the potential benefits to be realised when applying the method in developing performance measurement frameworks for business support units. Keywords: performance measurement, data envelopment analysis, decision making units, business support units. JEL Classification: C61, L25

This paper examines the strategic fit of mergers and acquisitions (M&A) in Mozambican banks, using a two‐stage data envelopment analysis (DEA) approach to compute the impact of contextual variables on efficiency scores and returns to scale of the resulting virtual merged banks. In an ‘M&A DEA’ model, different pairs of bidder and target companies are considered. In the first stage an M&A DEA model is used. Simplex regression is adopted in the second stage. The results reveal that ownership (public or foreign) impacts virtual efficiency levels. However, the findings also show that care must be exercised with M&A because the resultant banking organization could be oversized when foreign ownership is predominant, especially when public ownership is low. Given the relative sizes of the markets in terms of productive resources, M&A involving Mozambican banks can easily lead to decreasing returns to scale. Thus, a greater emphasis should be given to merging purely public banks with foreign ones and vice versa.

Actuality. The tourism sector in the Republic of Moldova is growing in the context of a rather difficult period due to the economic and pandemic crises. This fact is due to the role of central and local authorities on sustainable development policies and strategies that have been and are being implemented for the development of tourism in the Republic of Moldova. Various forms of tourism can be practiced on the territory of the country, which, capitalized and supported by central and local authorities, can become the business card of domestic tourist destinations. One of these forms is sports tourism, which in recent years has acquired a special connotation, being more and more popular and with a significant increase. In this context, the central and local authorities collaborate in the perspective of the development of this form of tourism which, as demonstrated by the last sports events organized by the Republic of Moldova, are able to attract many athletes who are accompanied by both technical staff and microbiologists or close people that support them in their developments, a phenomenon that assumes that all those mentioned will use a range of tourist services on the territory of the Republic of Moldova (accommodation, food, transport, excursions, etc.), which will ensure their temporary stay in the area where the sporting event takes place . Purpose. Examining the contribution of central and local authorities in the sustainable development of sports tourism. Research methods. In order to carry out the study, there were applied methods that ensured the achievement of the established objectives, among them can be listed: the analysis of the specialized scientific-methodical literature, observation, methods of processing and quantitative and qualitative analysis of statistical data. Findings and results. The development of sports tourism can have a sustainable aspect if it is based on both economic and social and environmental objectives. Since sustainable development is a fundamental objective of the European Union, it must also be addressed in the field of sports tourism, and this fact is achieved by the central public authorities through the development of strategies for the development of the tourism sector, namely the Tourism Development Strategy in the Republic of Moldova between 2003 -2015, Tourism Development Strategy "Tourism 2020", National Tourism Development Program "Tourism 2026". All of them have a special role in the development of sports tourism, at each stage of this form of tourism being given a certain status and connotation depending on the developments on the international tourist market. In recent years, tourism at the local level has received significant attention from central and local authorities, the reason being the stimulation of the attractiveness of tourist destinations at the community level that can become a source of income for local budgets. In this context, at the local level, the authorities through various mechanisms try to develop the tourism sector depending on the existing tourism potential, the available infrastructure, but also within the limits of the existing financial sources. This fact required the creation of tourism development strategies, or sustainable, socio-economic and integrated development strategies in which a separate segment is dedicated to the tourism and sports sectors at district level, which set priorities for the development of various forms of tourism, including sports, as a form of tourism that can ensure the development of local communities, by: creating jobs, developing small and medium enterprises, etc. At the same time, they include a series of actions for the valorization of sports tourism, which are mostly focused on: the development of sports infrastructure, the promotion of tourism forms including sports, the holding of sports events, etc. According to the World Tourism Organization (WTO), sporting events can be a catalyst for tourism development if they are successfully exploited in terms of destination branding, infrastructure development and other economic and social benefits. In the Republic of Moldova, in recent years, more attention has been paid to the development of the appropriate infrastructure to ensure the holding of sports events, but also the practice of various sports events, but there are still great reservations in this regard, especially since this is mainly in the capital and less at the regional or local level, and the development of sports tourism is not possible without a technical-material base and tourist destinations prepared for such a tourism form. In the last five years in the Republic of Moldova there has been an increase in sports buildings, and an example is the construction of the "Chisinau Arena" complex, which has already hosted a series of events attended by hundreds of athletes and spectators, and an eloquent one was the Championship European weightlifting among young people that brought together 346 athletes, but also members of their technical staff, as well as supporters. However, at the regional level, the local authorities try to develop this form of tourism within the limits of financial possibilities, by creating the necessary infrastructure that meets international requirements to be able to organize sports events that attract both athletes and their teams, as well as tourists who are interested in sports activities during their travels, regardless of whether sports is the main purpose of it. In addition to the precarious economic situation at the national level and at the regional level, in the last five years, the sports edifices register both slight increases in some structures and decreases in certain regional areas, a fact that highlights that the sports tourism sector is stagnant and does not contribute significantly to the development of local destinations. Conclusions and recommendations. As a result of the research carried out regarding the role of the central and local authorities in the Republic of Moldova in the sustainable development of sports tourism, it can be mentioned that they have elaborated development strategies, which assume the valorization of sports tourism for the economic development of local communities. In recent years, they have been reviewed and adapted to international requirements, and this fact is starting to bring economic benefits to the destination where the sports events take place (example: the European Weightlifting Championship in 2023). At the same time, at the local level, the authorities have well-established directions until 2026 regarding the development of sports tourism and its forms, such as: nautical tourism, aero tourism, mountaineering, etc. Not following the directions drawn, sports buildings at the national level do not register a significant improvement, and this fact endangers the development of sports tourism. Thus, it is recommended to develop a concept for the development of this form of tourism with an emphasis on the initial development of the areas where this form of tourism has real chances of development.

The aim of the present paper is to demonstrate the viability of using data envelopment analysis (DEA) in a regional context to evaluate entrepreneurial activities. DEA was used to assess regional entrepreneurship in Greece using individual measures of entrepreneurship as inputs and employment rates as outputs. In addition to point estimates, a bootstrap algorithm was used to produce bias-corrected metrics. In the light of the results of the study, the Greek regions perform differently in terms of converting entrepreneurial activity into job creation. Moreover, there is some evidence that unemployment may be a driver of entrepreneurship and thus negatively affects DEA-based inefficiency. The derived indicators can serve as diagnostic tools and can also be used for the design of various interventions at the regional level.

PurposeThe purpose of this paper is to propose a benchmarking framework to evaluate the efficiency and effectiveness of the hotel industry, in a multi‐period context, with consideration of perishable traits and carry‐over activities. The sustained high performers in the case study are identified and their business strategies are discussed.Design/methodology/approachThe dynamic DEA (data envelopment analysis) approach is used to identify the multi‐period sustained high performers. The super‐efficiency DEA approach is employed to conduct a thorough ranking under an input‐output‐consumption structure. The supplementary analysis is further implemented to help elucidate the benchmarking results.FindingsIn total, nine out of 80 international tourist hotels in Taiwan during 2006‐2010 are identified as the sustained high performers. These hotels have diverged business strategies in terms of employees (intensive versus economical labor forces), products (room versus F&B (food and beverage) services), prices (extremely expensive versus very inexpensive room rates), guests (business versus tourism guests), and others (e.g. location advantages).Originality/valueThis study contributes to benchmarking literature and to hotel industry in several aspects. Compared with conventional single‐period benchmarking in efficiency aspect only, the proposed multi‐period benchmarking framework under input‐production‐consumption structure can take into account the carry‐over activities, account for perishable traits, provide more robust results, and add more useful information to facilitate the hotel managers to ameliorate the efficiency and effectiveness. The proposed framework should be readily applied to other service industries (e.g. transport).

Both the fourth industrial revolution (Industry 4.0) and its embedded technology diffusion exponentially progress and grow in terms of technical change and socioeconomic impact. The aim of this study was the evaluation of research and development efficiency in the public and private sectors in EU countries. The Data Envelopment Analysis (DEA) methodology, within which the slack-based model was applied, was used to achieve this aim. The Malmquist index (MI) was used to calculate changes in research and development efficiency during 2010/2013 and 2014/2017. The results present a decrease in total Research and Development (R&D) productivity in public and private sectors for an average of EU countries (28). However, Spain, Slovenia, and Portugal (in the public sector), and Ireland and Romania (in the private sector) revealed an increase of a total R&D productivity during 2010/2013 and 2014/2017 that was primarily influenced by an increase of technical efficiency (catch-up effect). Similarly, the results confirm the differences in R&D efficiency in private and public sectors in the European countries. The study’s results also provide a valuable platform for creators of national strategic and innovative investment and educational plans, and creators of relevant policies and create a platform for national and international benchmarking indicators.

This study evaluates the determinants of public spending efficiency at the provincial level in Peru by integrating Data Envelopment Analysis (DEA) with two alternative econometric models: a bootstrapped random-effects Tobit model and a spatial Durbin model. Using panel data from 196 provinces over 7 years, DEA efficiency scores under constant returns to scale (CRS) and variable returns to scale (VRS) were estimated and analyzed to assess the impact of intergovernmental transfers, local tax revenues, and spatial interdependencies. The Tobit model accounts for the bounded nature of efficiency scores and shows that FONCOMUN transfers significantly improve both technical efficiency (VRS_TE) and scale efficiency, while canon transfers primarily enhance scale efficiency due to their infrastructure-oriented allocation but have limited effects on managerial performance. Local tax revenues positively influence technical efficiency, reflecting better expenditure management in fiscally autonomous municipalities, but they have no significant effect on scale efficiency. In contrast, the spatial Durbin model captures spatial dependencies and reveals significant negative spillover effects, indicating that higher efficiency in neighboring provinces can reduce local efficiency due to competition for resources and overlapping administrative functions. These findings contribute to the literature by providing robust empirical evidence on the interplay between fiscal transfers, managerial capacity, and spatial interdependencies, offering actionable insights for policymakers seeking to optimize local government performance and improve public service delivery.

This study aimed to determine the extent of the impact of financial control on the efficiency of public spending in the Kingdom of Saudi Arabia to regulate corruption, reduce waste of public funds, enhance transparency, and assess the effectiveness of current financial control legislation and agencies, and the procedures included therein, to understand their responsiveness, efficiency, and their impact on diversifying income sources, reducing unemployment rates, and their effect on economic growth through the analysis and study of international and local reports and indicators regarding financial control. Additionally, this study reviews the most distinguished international experiences in financial control and how to benefit from them to enhance the efficiency of control over the implementation of the general budget in the Kingdom. This study adopts the descriptive-analytical approach to reveal the effectiveness of current financial control over the public budget in the Kingdom of Saudi Arabia, and its impact on the efficiency of spending, relying on three important indicators that represent the growth rate, unemployment rate, and diversification of income sources, through the review and analysis of international and local reports and indicators during the period covered by the Open Budget Index in the Kingdom, starting from 2008 to 2023. The study revealed the necessity of financially and administratively independent financial control agencies, granting them the necessary powers to carry out their tasks, making all administrative levels accountable, with the need for continuous updating of financial control legislation and laws in the Kingdom, activating what has recently been introduced of systems, working on integrating control agencies, in addition to the importance of exercising preventive control before preparing the budget to avoid budget deficit crises and preserve public funds. The researcher believes, through what has been discussed, that this study provides a valuable contribution to the development of financial control policies in the Kingdom of Saudi Arabia.