Data envelopment analysis for unified efficiency evaluation: an assessment of regional industries in China

Data envelopment analysis has recently gained popularity and attention in operational and environmental assessment. A common feature of previous studies is decreasing an input vector to decrease the vector of undesirable outputs which is referred to as natural disposability. However, little research has considered how to increase the amount of capital input for clean production technology to decrease the amount of undesirable outputs in a data envelopment analysis framework, which is referred to as managerial disposability. Thus, this paper proposes an improved approach that considers measuring unified (operational and environmental) efficiency for managerial disposability, and compares this approach with the one for natural disposability. The proposed approach provides a positive strategy to reduce undesirable outputs and improve unified efficiency through increasing capital investment in clean production technology. A case study of regional industries in China in 2006-2010 utilizing this approach is also presented. The empirical study shows that the unified efficiencies of regional industries in China have relatively high scores for managerial disposability, and increasing capital investment is vital to achieve sustainable development in clean production technology.