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The transient and persistent efficiency of Italian and German universities: A stochastic frontier analysis

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  • Agasisti, Tommaso
  • Gralka, Sabine

Abstract

Despite measures on the European level to increase the compatibility between the HE sectors of the member states, the recent literature exposes variations in their efficiencies. To gain insights into these differences we split the efficiency term according to the two management levels each university is confronted with. Utilizing a recent advancement in the method to measure efficiency, we separate short-term (transient) and long-term (persistent) efficiency, while controlling for unobserved institution specific heterogeneity. While the first term reflects the efficiency of the individual universities working within the country, the second term echoes the influence of the country specific overall HE structure. The cross-country comparison displays if the overall efficiency difference between countries is related to individual performance of their universities or their HE structure. This allows more purposeful policy recommendation and expands the literature regarding the efficiency of universities in a fundamental way. Choosing Italy and Germany as two important illustrative examples we can take advantage of a novel dataset including characteristics of institutions in both countries for an exceptional long period of time from 2001 to 2011. We show that the Italian universities exhibit a higher overall efficiency value than their German counterparts. With the individual universities working at the upper bound of efficiency in both countries, the overall inefficiency as well as the gap between the countries is caused by persistent, structural inefficiency. To expedite a true European Area of Higher Education future measures should hence aim at the country specific structure, not solely at affecting the activities of single universities.

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  • Agasisti, Tommaso & Gralka, Sabine, 2017. "The transient and persistent efficiency of Italian and German universities: A stochastic frontier analysis," CEPIE Working Papers 14/17, Technische Universität Dresden, Center of Public and International Economics (CEPIE).
    • Handle: RePEc:zbw:tudcep:1417
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    Cited by:

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    3. Gralka, Sabine & Wohlrabe, Klaus & Bornmann, Lutz, 2017. "The Completion Shift of German Universities of Applied Sciences," MPRA Paper 82794, University Library of Munich, Germany.
    4. Gralka, Sabine, 2018. "Stochastic frontier analysis in higher education: A systematic review," CEPIE Working Papers 05/18, Technische Universität Dresden, Center of Public and International Economics (CEPIE).
    5. Biao Chen & Yan Chen & Xianghua Qu & Wanyu Huang & Panyu Wang, 2023. "Do Financial Investment, Disciplinary Differences, and Level of Development Impact on the Efficiency of Resource Allocation in Higher Education: Evidence from China," Sustainability, MDPI, vol. 15(9), pages 1-23, April.
    6. Fu, Tsu-Tan & See, Kok Fong, 2022. "An integrated analysis of quality and productivity growth in China’s and Taiwan’s higher education institutions," Economic Analysis and Policy, Elsevier, vol. 74(C), pages 234-249.
    7. Hengfan Lu & Jiachao Peng & Xiangyi Lu, 2022. "Do Factor Market Distortions and Carbon Dioxide Emissions Distort Energy Industry Chain Technical Efficiency? A Heterogeneous Stochastic Frontier Analysis," Energies, MDPI, vol. 15(17), pages 1-22, August.
    8. Alice Bertoletti & Geraint Johnes, 2021. "Efficiency in university-industry collaboration: an analysis of UK higher education institutions," Scientometrics, Springer;Akadémiai Kiadó, vol. 126(9), pages 7679-7714, September.
    9. Lutz Bornmann & Klaus Wohlrabe & Sabine Gralka, 2019. "The graduation shift of German universities of applied sciences," PLOS ONE, Public Library of Science, vol. 14(1), pages 1-19, January.
    10. Klaus Wohlrabe & Sabine Gralka & Lutz Bornmann, 2019. "Zur Effizienz deutscher Universitäten und deren Entwicklung zwischen 2004 und 2015," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 72(21), pages 15-21, November.
    11. Oleg Badunenko & Deni Mazrekaj & Subal C. Kumbhakar & Kristof Witte, 2021. "Persistent and transient inefficiency in adult education," Empirical Economics, Springer, vol. 60(6), pages 2925-2942, June.
    12. Berbegal-Mirabent, Jasmina & Gil-Doménech, Dolors & de la Torre, Rocío, 2019. "Dealing with heterogeneity: An analysis of Spanish universities," TEC Empresarial, School of Business, Costa Rica Institute of Technology (ITCR), vol. 13(3), pages 58-77.
    13. Tran, Carolyn D.T.T. & Battese, George E. & Villano, Renato A., 2020. "Administrative capacity assessment in higher education: The case of universities in Vietnam," International Journal of Educational Development, Elsevier, vol. 77(C).
    14. Bornmann, Lutz & Gralka, Sabine & Anegón, Félix de Moya & Wohlrabe, Klaus, 2023. "Efficiency of universities and research-focused institutions worldwide: The introduction of a new input indicator reflecting institutional staff numbers," Journal of Informetrics, Elsevier, vol. 17(2).
    15. Lutz Bornmann & Sabine Gralka & Félix de Moya Anegón & Klaus Wohlrabe, 2020. "Efficiency of Universities and Research-Focused Institutions Worldwide: An Empirical DEA Investigation Based on Institutional Publication Numbers and Estimated Academic Staff Numbers," CESifo Working Paper Series 8157, CESifo.
    16. Tommaso Agasisti & Guo-liang Yang & Yao-yao Song & Carolyn-Thi Thanh Dung Tran, 2021. "Evaluating the higher education productivity of Chinese and European “elite” universities using a meta-frontier approach," Scientometrics, Springer;Akadémiai Kiadó, vol. 126(7), pages 5819-5853, July.
    17. Garcia, Luis & Laepple, Doris & Dillon, Emma & Thorne, Fiona, 2020. "The role of hired labor in transient and persistent technical efficiency on Irish dairy farms," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304395, Agricultural and Applied Economics Association.
    18. Manuel Salas‐Velasco, 2020. "Assessing the performance of Spanish secondary education institutions: Distinguishing between transient and persistent inefficiency, separated from heterogeneity," Manchester School, University of Manchester, vol. 88(4), pages 531-555, July.
    19. Sabine Gralka & Klaus Wohlrabe & Lutz Bornmann, 2018. "How to Measure Research Efficiency in Higher Education? Research Grants vs. Publication Output," CESifo Working Paper Series 7055, CESifo.

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    More about this item

    Keywords

    Stochastic Frontier Analysis; Persistent Inefficiency; Higher Education; Costfunction; Italy; Germany;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education

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