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Regional Environmental Quality and Cost Efficiency of International Tourist Hotels in Taiwan

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  • Chin-Tsu Chen
  • Jin-Li Hu
  • Shin-Lung Lin

Abstract

The purpose of this study is to compute the cost efficiency of international tourist hotels (ITHs) in Taiwan and analyze how regional environmental quality affects cost efficiency. The study collects a variety of operating data of international tourist hotels in Taiwan between 1998 and 2009 from the Annual Tourist Hotels Operational Analysis Report, as published by the Tourism Bureau. The data of regional environmental quality are collected from the Taiwan Environment Data Warehouse. This study first uses data envelopment analysis (DEA) for computing cost efficiency, and then applies the truncated regression to investigate the impact of environmental indicators on cost efficiency. Namely, it is a two-stage DEA-regression method. The empirical results indicate that the density of pungent air pollutants, such as O3 and SO2, have significantly negative impacts on the cost efficiency of ITHs in Taiwan. However, the high volume of waste disposal and low recycling rate reflect a higher business activity intensity in a region, which positively enhances ITHs’ cost efficiency.

Suggested Citation

  • Chin-Tsu Chen & Jin-Li Hu & Shin-Lung Lin, 2014. "Regional Environmental Quality and Cost Efficiency of International Tourist Hotels in Taiwan," Energy and Environment Research, Canadian Center of Science and Education, vol. 4(3), pages 1-58, December.
    • Handle: RePEc:ibn:eerjnl:v:4:y:2014:i:3:p:58
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    References listed on IDEAS

    as
    1. Twan Huybers & Jeff Bennett, 2003. "Environmental Management and the Competitiveness of Nature-Based Tourism Destinations," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 24(3), pages 213-233, March.
    2. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    3. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
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    Cited by:

    1. Lin, Boqiang & Guan, Chunxu, 2023. "Evaluation and determinants of total unified efficiency of China's manufacturing sector under the carbon neutrality target," Energy Economics, Elsevier, vol. 119(C).

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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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