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Incorporating contextual information in public sector efficiency analyses: A comparative study of NSW local government

Worthington, Andrew C. & Dollery, Brian E. (2002) Incorporating contextual information in public sector efficiency analyses: A comparative study of NSW local government. Applied Economics, 34(4), pp. 453-464.

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Abstract

Using the planning and regulatory function of one hundred and seventy-three NSW local governments, several approaches for incorporating contextual or nondiscretionary inputs in data envelopment analysis (DEA) are compared. Nondiscretionary inputs (or factors beyond managerial control) in this context include the population growth rate and distribution, the level of development and non-residential building activity, and the proportion of the population from a non-English speaking background. The approaches selected to incorporate these variables include discretionary inputs only, nondiscretionary and discretionary inputs treated alike and differently, categorical inputs, ‘adjusted’ DEA, and ‘endogenous’ DEA. The results indicate that the efficiency scores of the five approaches that incorporated nondiscretionary factors were significantly positively correlated. However, it was also established that the distributions of the efficiency scores and the number of councils assessed as perfectly technically efficient in the six approaches also varied significantly across the sample.

Impact and interest:

19 citations in Scopus
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14 citations in Web of Science®

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ID Code: 2566
Item Type: Journal Article
Keywords: Data envelopment analysis, technical and scale efficiency, planning and development, local government
DOI: 10.1080/00036840110044171
ISSN: 1466-4283
Subjects: Australian and New Zealand Standard Research Classification > ECONOMICS (140000) > APPLIED ECONOMICS (140200) > Public Economics- Taxation and Revenue (140215)
Australian and New Zealand Standard Research Classification > STUDIES IN HUMAN SOCIETY (160000) > POLITICAL SCIENCE (160600) > Australian Government and Politics (160601)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Copyright Owner: Copyright 2002 Taylor & Francis
Copyright Statement: First published in Applied Economics 34(4):pp. 453-464.
Deposited On: 21 Nov 2005
Last Modified: 05 Jan 2011 23:25

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