Economic and Environmental Assessment: EU Cross-country Efficiency Ranking Analysis

This article aims to estimate and compare the efficiency of 26 different European Countries over 2001 and 2012, using Data Envelopment Analysis (DEA) technique. Both output-and input-oriented models were used in order to see if efficiency rankings change. In the input oriented model the inputs used were capital (K), labor (L), renewable energy (R) and fossil fuel (F). In the output oriented model the inputs considered were GDP/L, GDP/K, F/GDP and R/GDP (share of renewable energy in Gross Domestic Product (GDP)), and for both the output considered is GDP per greenhouse gases (GHG) emissions. Our results show that economic and environmental estimates for these European countries change if we propose different input or output-oriented models. It changes mainly in terms of years and technical efficiency versions. While some countries succeeded in terms of National Renewable Energy Action Plans, others observed a ranking decrease through time, thus suggesting that a higher emphasis should be provided in the accomplishment of European Environmental Policies.