Comparing and contrasting poverty reduction performance of social welfare programs across jurisdictions in Canada using Data Envelopment Analysis (DEA): An exploratory study of the era of devolution

In the mid-1990s, the responsibilities to design, implement, and evaluate social welfare programs were transferred from federal to local jurisdictions in many countries of North America and Europe through devolution processes. Devolution has caused the need for a technique to measure and compare the performances of social welfare programs across multiple jurisdictions. This paper utilizes Data Envelopment Analysis (DEA) for a comparison of poverty reduction performances of jurisdictional social welfare programs across Canadian provinces. From the theoretical perspective, findings of this paper demonstrates that DEA is a promising method to evaluate, compare, and benchmark poverty reduction performance across multiple jurisdictions using multiple inputs and outputs. This paper demonstrates that DEA generates easy to comprehend composite rankings of provincial performances, identifies appropriate benchmarks for each inefficient province, and estimates sources and amounts of improvement needed to make the provinces efficient. From a practical perspective the empirical results presented in this paper indicate that Newfoundland, Prince Edwards Island, and Alberta achieve better efficiency in poverty reduction than other provinces. Policy makers and social administrators of the ineffective provinces across Canada may find benefit in selecting one of the effective provinces as a benchmark for improving their own performance based on similar size and structure of population, size of the budget for social programs, and traditions with administering particular types of social programs.