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Decomposition of the environmental inefficiency of the meta-frontier with undesirable output

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  • Chiu, Ching-Ren
  • Liou, Je-Liang
  • Wu, Pei-Ing
  • Fang, Chen-Ling
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    Abstract

    In this paper, we present an alternative analysis framework to evaluate the effects of technology heterogeneities and undesirable output on environmental efficiency measurement. The proposed framework combines the directional distance function and a meta-frontier analysis. It can be used to measure efficiency improvements brought about by enhanced technical management and technological advances. For demonstration purposes, we used the framework to measure the environmental efficiency in 90 countries worldwide for the 2003–2007 period. The results showed that when the meta-technology set is used as the evaluation basis, the average environmental efficiency of high competitiveness countries is greater than that of lower-middle, low, and upper-middle competitiveness countries. The upper-middle competitiveness countries perform worse than the lower-middle and low competitiveness countries because of the excessive labor force usage and carbon dioxide emissions in these countries. We also found that the environmental inefficiency of the meta-frontier for high competitiveness countries can be attributed to managerial failure in the production process, whereas that for upper-middle, lower-middle, and low competitiveness countries can be attributed to technological differences.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0140988312001089
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    Bibliographic Info

    Article provided by Elsevier in its journal Energy Economics.

    Volume (Year): 34 (2012)
    Issue (Month): 5 ()
    Pages: 1392-1399

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    Handle: RePEc:eee:eneeco:v:34:y:2012:i:5:p:1392-1399

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    Web page: http://www.elsevier.com/locate/eneco

    Related research

    Keywords: Environmental efficiency; Meta-frontier inefficiency; Carbon dioxide emissions; Directional distance function;

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    References

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    Cited by:
    1. Chung, Yeimin & Heshmati, Almas, 2013. "Measurement of Environmentally Sensitive Productivity Growth in Korean Industries," IZA Discussion Papers 7235, Institute for the Study of Labor (IZA).
    2. Wang, Qunwei & Zhao, Zengyao & Zhou, Peng & Zhou, Dequn, 2013. "Energy efficiency and production technology heterogeneity in China: A meta-frontier DEA approach," Economic Modelling, Elsevier, vol. 35(C), pages 283-289.
    3. Jin, Jingliang & Zhou, Dequn & Zhou, Peng, 2014. "Measuring environmental performance with stochastic environmental DEA: The case of APEC economies," Economic Modelling, Elsevier, vol. 38(C), pages 80-86.
    4. Du, Kerui & Lu, Huang & Yu, Kun, 2014. "Sources of the potential CO2 emission reduction in China: A nonparametric metafrontier approach," Applied Energy, Elsevier, vol. 115(C), pages 491-501.
    5. Roberto Gómez-Calvet & David Conesa & Ana Rosa Gómez-Calvet & Emili Tortosa-Ausina, 2013. "Energy efficiency in the European Union: What can be learned from the joint application of directional distance functions and slacks-based measures?," Working Papers 2013/17, Economics Department, Universitat Jaume I, Castellón (Spain).
    6. Zhang, Ning & Zhou, P. & Choi, Yongrok, 2013. "Energy efficiency, CO2 emission performance and technology gaps in fossil fuel electricity generation in Korea: A meta-frontier non-radial directional distance functionanalysis," Energy Policy, Elsevier, vol. 56(C), pages 653-662.
    7. Pombo, Carlos & Taborda, Rodrigo, 2006. "Performance and efficiency in Colombia's power distribution system: Effects of the 1994 reform," Energy Economics, Elsevier, vol. 28(3), pages 339-369, May.

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