Eco-Efficiency Evaluation Considering Environmental Stringency

Pyoungsoo Lee and You-Jin Park
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Pyoungsoo Lee: Korea E-Trade Research Institute, Chung-Ang University, Seoul 06974, Korea
You-Jin Park: School of Business Administration, College of Business and Economics, Chung-Ang University, Seoul 06974, Korea

Sustainability, 2017, vol. 9, issue 4, 1-18

Abstract: This paper proposes an extended data envelopment analysis (DEA) model for deriving eco-efficiency. In order to derive eco-efficiency, the proposed model utilizes the concepts of operational efficiency and environmental efficiency. Since DEA can separately measure operational efficiency and environmental efficiency, the treatment for constructing the unified indicator is required to ultimately evaluate eco-efficiency through balancing operational and environmental concerns. To achieve this goal, we define the environmental stringency as the business condition reflecting the degree of enforcing environmental regulations across the firms or particular industries in different countries. The proposed model provides flexibility, as required by the pollution-intensity of industry, in that it allows the decision maker to evaluate DMU’s (decision-making unit) eco-efficiency appropriately depending on the business environment. We present a case of agricultural production systems to help readers understand what eco-efficiency becomes when we vary the stringency conditions. Through the illustrative example, this paper presents the potential application by which different environmental stringencies can successively be incorporated in DEA.

Keywords: eco-efficiency; operational efficiency; environmental efficiency; data envelopment analysis (DEA) (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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