A response to M. Stone: 'How not to measure the efficiency of public services (and how one might)'

W. W. Cooper and Subhash C. Ray

Journal Of The Royal Statistical Society Series A, 2008, vol. 171, issue 2, pages 433-448

Abstract: This is a response to Stone's criticisms of the Spottiswoode report to the UK Treasury which was responding to the Treasury's request for improved methods to evaluate the efficiency and productivity of the 43 police districts in England and Wales. The Spottiswoode report recommended uses of data envelopment analysis (DEA) and stochastic frontier analysis (SFA), which Stone critiqued "en route" to proposing an alternative approach. Here we note some of the most serious errors in his criticism and inaccurate portrayals of DEA and SFA. Most of our attention is devoted to DEA, and to Stone's recommended alternative approach without much attention to SFA, partly because of his abbreviated discussion of the latter. In our response we attempt to be constructive as well as critical by showing how Stone's proposed approach can be joined to DEA to expand his proposal beyond limitations in his formulations. Copyright (c) 2008 Royal Statistical Society.

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