Efficiency ranking of the OECD member states in the area of telecommunications: A composite AHP/DEA study

The purpose of this work is to compare and then rank all (30) Organisation for Economic Co-operation and Development (OECD) member states as regards telecommunications efficiency. The required data series come from OECD's Telecommunications Database 2005. Two quantitative instruments have been employed: analytic hierarchy process (AHP) and data envelopment analysis (DEA). Pair-wise country performance evaluation has been constructed at four levels by means of AHP. A two-dimensional analysis for assessing country efficiency in telecommunications has been carried out using both AHP and DEA. The overall analysis points to four different efficiency groups; each group occupies one of four possible quadrants. Eight countries have been found efficient on both dimensions of the productivity-revenue plane: they form the overall efficiency frontier and serve as benchmarks for the rest of the countries. The paper concludes with a discussion of the policy implications of the results obtained, with an emphasis on the requirements for improving the efficiency of the countries lagging behind their respective benchmarks. The numerical examples given illustrate the effort required by these less efficient countries towards achieving full efficiency.