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Extending the use of super-efficiency under undesirable outputs: An application to energy efficiency in the European Union

Author

Listed:
  • Roberto Gómez-Calvet

    () (Business Department, European University of Valencia, Valencia, Spain)

  • David Conesa

    () (Statistics and Operational Research Department, Universidad de Valencia, Valencia, Spain)

  • Ana Rosa Gómez-Calvet

    () (Business Finance Department, Universidad de Valencia, Valencia, Spain)

  • Emili Tortosa-Ausina

    () (IVIE and Department of Economics, Universitat Jaume I, Castellón, Spain)

Abstract

Data Envelopment Analysis (DEA) models have been intensively used for measuring efficiency in a variety of contexts. More recently, the inclusion of undesirable outputs has extended their use to analyze relevant fields such as environmental efficiency. In this context, Slacks-Based Measure (SBM) models offer a remarkable alternative, largely due to their ability to deal with undesirable outputs. Additionally, super-efficiency evaluation in DEA is a useful complementary analysis for ranking the performance of efficient DMUs. Although the literature has already considered a pioneering proposal for dealing with super-efficiency in SBM models, which may be referred to as Super-SBM, we extend this approach to the presence of undesirable outputs. We illustrate this contribution in three scenarios where super-efficiency SBM models with undesirable outputs may be of interest: (i) the analysis of productivity change; (ii) the provision of a full ranking of efficiency (also including efficient units); and (iii) the detection of influential units. Finally, we present and discuss an empirical application dealing with environmental efficiency in electricity and derived heat generation in the European Union.

Suggested Citation

  • Roberto Gómez-Calvet & David Conesa & Ana Rosa Gómez-Calvet & Emili Tortosa-Ausina, 2014. "Extending the use of super-efficiency under undesirable outputs: An application to energy efficiency in the European Union," Working Papers 2014/03, Economics Department, Universitat Jaume I, Castellón (Spain).
  • Handle: RePEc:jau:wpaper:2014/03
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    Keywords

    efficiency; energy; slacks-based measure; super-efficiency; undesirable outputs;

    JEL classification:

    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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