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Comparing French and US hospital technologies: a directional input distance function approach

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  • Benoit Dervaux
  • Gary Ferrier
  • Herve Leleu
  • Vivian Valdmanis

Abstract

French and US hospital technologies are compared using directional input distance functions. The aggregation properties of the directional distance function allow comparison of hospital industry-level performance as well as standard firm-level performance with regard to productive efficiency. In addition, the underlying constituents of efficiency - in the short run, congestion and technical inefficiency, and in the long run, scale inefficiency - are analysed by decomposing the overall measure. By virtue of using the directional distance function, it is also possible to obtain an estimate of a lower bound on allocative inefficiency. It is found that French and US hospitals use quite different technologies. Long run scale inefficiencies cause most of the French hospitals' inefficiency, while short run technical inefficiency is the main source of overall productive inefficiency in the US hospitals.

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  • Benoit Dervaux & Gary Ferrier & Herve Leleu & Vivian Valdmanis, 2004. "Comparing French and US hospital technologies: a directional input distance function approach," Applied Economics, Taylor & Francis Journals, vol. 36(10), pages 1065-1081.
    • Handle: RePEc:taf:applec:v:36:y:2004:i:10:p:1065-1081
    DOI: 10.1080/0003684042000246786
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    16. Färe, Rolf & Pasurka, Carl & Vardanyan, Michael, 2017. "On endogenizing direction vectors in parametric directional distance function-based models," European Journal of Operational Research, Elsevier, vol. 262(1), pages 361-369.
    17. Vardanyan, Michael & Valdmanis, Vivian G. & Leleu, Hervé & Ferrier, Gary D., 2022. "Estimating technology characteristics of the U.S. hospital industry using directional distance functions with optimal directions," Omega, Elsevier, vol. 113(C).
    18. Medin, Emma & Häkkinen, Unto & Linna, Miika & Anthun, Kjartan S. & Kittelsen, Sverre A.C. & Rehnberg, Clas, 2013. "International hospital productivity comparison: Experiences from the Nordic countries," Health Policy, Elsevier, vol. 112(1), pages 80-87.
    19. Yanzhi Bi, 2021. "Analyzing the performance of the Major League Baseball Teams by using the Data Envelopment Analysis," Business & Entrepreneurship Journal, SCIENPRESS Ltd, vol. 10(1), pages 1-1.
    20. Varabyova, Yauheniya & Schreyögg, Jonas, 2013. "International comparisons of the technical efficiency of the hospital sector: Panel data analysis of OECD countries using parametric and non-parametric approaches," Health Policy, Elsevier, vol. 112(1), pages 70-79.
    21. Färe, Rolf & Karagiannis, Giannis, 2022. "Aggregating Farrell efficiencies without value data: The case of hospitals," Socio-Economic Planning Sciences, Elsevier, vol. 84(C).

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