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Multiplicative efficiency aggregation to evaluate Taiwanese local auditing institutions performance

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Listed:
  • Wen-Min Lu

    (Chinese Culture University)

  • Qian Long Kweh

    (Canadian University Dubai)

  • Kai-Chu Yang

    (National Central University)

Abstract

This study evaluates the management efficiency and quality effectiveness of Taiwanese local auditing institutions (LAIs), whereby two outputs leave the first stage without being inputted to the second stage under the assumption of variable returns to scale. To address these considerations, this study integrates multiplicative efficiency aggregation (MEA) in a two-stage network data envelopment analysis (DEA) model into the form of second order cone programming (SOCP). Under a cone structure, our DEA findings indicate that management efficiency increased, and quality effectiveness decreased over the sample period 2013–2015. Besides, a truncated regression analysis indicates that differences in operating environments, particularly urbanization level and LAIs’ attributes, have significant impacts on the management efficiency of LAIs. The potential applications and strengths of SOCP and MEA-based two-stage network DEA in assessing the LAIs are highlighted.

Suggested Citation

  • Wen-Min Lu & Qian Long Kweh & Kai-Chu Yang, 2022. "Multiplicative efficiency aggregation to evaluate Taiwanese local auditing institutions performance," Annals of Operations Research, Springer, vol. 315(2), pages 1243-1262, August.
    • Handle: RePEc:spr:annopr:v:315:y:2022:i:2:d:10.1007_s10479-020-03592-x
    DOI: 10.1007/s10479-020-03592-x
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