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Efficiency frontier of OECD MNOs: Multinational vs Domestic

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  • Bielov, Constantine
  • Mitomo, Hitoshi
  • Hämmäinen, Heikki

Abstract

This paper evaluates the efficiency frontier of 34 mobile operators from OECD countries and compares the performance of multinational companies and domestic companies between 2014 and 2018. Unlike most previous studies, the present paper relies on non-financial data for both input and output variables. It uses slack-based Data Envelopment Analysis (SBM DEA) to obtain the efficiency scores. The efficiency scores were compared for the statistically significant differences using Mann-Whitney U test. Our findings showed domestic companies to be more efficient than multinational ones regardless of their scale. The suggested explanation is that domestic enterprises are better at managing their resources and more familiar with their local market. The results also indicate that the primary source of inefficiency was inadequate utilisation of the available spectrum range. These empirical findings provide extra insight to the managers in the industry on possible steps to reduce the efficiency from the perspective of non-financial data.

Suggested Citation

  • Bielov, Constantine & Mitomo, Hitoshi & Hämmäinen, Heikki, 2022. "Efficiency frontier of OECD MNOs: Multinational vs Domestic," Telecommunications Policy, Elsevier, vol. 46(5).
    • Handle: RePEc:eee:telpol:v:46:y:2022:i:5:s0308596122000465
    DOI: 10.1016/j.telpol.2022.102344
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