Efficiency in public schools: Does competition matter?

The focus of many recent school reforms has been on changing the incentives faced by school administrators, mainly through increased competition. In this study, we assess whether competition amongst public schools influences the efficiency in which these schools operate, using a two-stage estimation procedure and data from the state of Illinois from 1997–1998. We find some evidence that public school districts become more efficient as neighboring districts become more efficient. However, such spillovers only occur if districts operate within a financially flexible environment.     

Government secondary school finances in New South Wales: accounting for students’ prior achievements in a two-stage DEA at the school level

This study measures the efficiency of government secondary schools in New South Wales, Australia, using a two-stage semi-parametric production frontier approach to schooling. In contrast to previous research comparing school performance with two-stage data envelopment analysis (DEA), we control for prior academic achievement of students by using a rich data set from 2008 to 2010. We employ detailed financial data for deriving the envelope for the efficient production frontier of the schools. Using Simar and Wilson’s (J Econ 136:31-64, 2007, J Prod Anal 36:205-218, 2011a) double bootstrap procedure for two-stage DEA, the study finds that schools with lower total student numbers, a higher average of years of service of teachers, a higher ratio of special education students that attracts extra government funding, and girls only do better than other schools. On the other hand, a negative influence comes from a school’s location in provincial and outer metropolitan areas. An important result is that the socio-economic background of students attending a school has no significant effect on their academic performance, whereas higher prior academic achievements have a positive and statistically significant impact on student achievement. These results are relevant to decision makers for the school sector, in particular for funding criteria contained in the Gonski (Review of funding for schooling - Final report (December). Canberra: Commonwealth Government of Australia, 2011) review report.     

The pyramid model of school management

Models of organizational management are presented in the literature and in the managerial practices of recent years. They are aimed to improve organizational governance, and to enhance organizational overall efficiency. The common denominator for most, if not all these management models is that they generally focus on a single aspect, or on a very limited number of aspects of the organizational conduct whereas running an organization is a highly complex undertaking, incorporating a large number of functions and processes. School principals tend to adapt out-of-school management process, usually adapting them from the business world. And therefore we can see that the educational system at all and the school system in particular, implement business management methods. This research indicates that school principals are well aware of all the school management processes and procedures. The important contribution of this research, which is based on the unique contribution of the multi-faceted theory, is acknowledging the work of the school principals as a pyramid which its base is composed of essential consensus procedures and its three sided indicate three major school management process. We suggest that this pyramid will be called “The Pyramid Model of School Management”. The various management processes that built this pyramid are based on mutual aims and consensus of the school team to reach these aims. The consensus of the aims is essential, and with out it, the school cannot exist as an affective organization. Choosing when to take a various management action is a feedback based, and situation-based conduct. It is also shown in this research that school principals distinguish between three major management processes which we recommend that they will be called the “pyramid sides” and include: results management, human resources management and general resources management. The three groups are bounded by the “core of management” which we recommend that will be called the “pyramid base”. The pyramid base is connected to each and every phase of the life cycle of the organization, to each process and each result. It includes the school targets and aims which all the school team has to agree upon and there must be an un-doubtful consensus about them.     

A graphically based machine learning approach to predict secondary schools performance in Tunisia

The main purpose of this paper is to identify the key factors that impact schools' academic performance and to explore their relationships through a two-stage analysis based on a sample of Tunisian secondary schools. In the first stage, we use the Directional Distance Function approach (DDF) to deal with undesirable outputs. The DDF is estimated using Data Envelopment Analysis method (DEA). In the second stage we apply machine-learning approaches (regression trees and random forests) to identify and visualize variables that are associated with a high school performance. The data is extracted from the Program for International Student Assessment (PISA) 2012 survey. The first stage analysis shows that almost 22% of Tunisian schools are efficient and that they could improve their students’ educational performance by 15.6% while using the same level of resources. Regression trees findings indicate that the most important factors associated with higher performance are school size, competition, class size, parental pressure and proportion of girls. Only, school location appears with no impact on school efficiency. Random forests algorithm outcomes display that proportion of girls at school and school size have the most powerful impact on the predictive accuracy of our model and hence could more influence school efficiency. The findings disclose also the high non-linearity of the relationships between these key factors and school performance and reveal the importance of modeling their interactions in influencing efficiency scores.     

One-stage estimation of the effects of operational conditions and practices on productive performance: asymptotically normal and efficient,root-<Emphasis Type="Italic">n</Emphasis> consistent StoNEZD method

Understanding the effects of operational conditions and practices on productive efficiency can provide valuable economic and managerial insights. The conventional approach is to use a two-stage method where the efficiency estimates are regressed on contextual variables representing the operational conditions. The main problem of the two-stage approach is that it ignores the correlations between inputs and contextual variables. To address this shortcoming, we build on the recently developed regression interpretation of data envelopment analysis (DEA) to develop a new one-stage semi-nonparametric estimator that combines the nonparametric DEA-style frontier with a regression model of the contextual variables. The new method is referred to as stochastic semi-nonparametric envelopment of z variables data (StoNEZD). The StoNEZD estimator for the contextual variables is shown to be statistically consistent under less restrictive assumptions than those required by the two-stage DEA estimator. Further, the StoNEZD estimator is shown to be unbiased, asymptotically efficient, asymptotically normally distributed, and converge at the standard parametric rate of order n ^−1/2. Therefore, the conventional methods of statistical testing and confidence intervals apply for asymptotic inference. Finite sample performance of the proposed estimators is examined through Monte Carlo simulations.     

The Quality of Data Obtained from Self-Completed Questionnaires in a Survey of High School Students

This study examines issues of data quality in a survey conducted in a nationwide probability sample of 8985 students in the last four years of high school education in Greece. Respondents completed an extensive questionnaire whose main topic of investigation was the use of licit and illicit substances (tobacco, alcohol, cannabis, etc.). We examined the effect of sex, age and school performance on data quality. Specifically, we related these factors to the probabilities of correctly observing filters in the questionnaire, of certain inconsistencies in responses, of reporting difficulty in understanding the questions and being able to answer honestly. It was found that all these factors have strong effects. Boys’ responses presented more problems than girls’ (median odds ratio in a series of separate logistic regressions = 1.35) and younger respondents’ more than older (median odds ratio 1.34 for ages 13–14 and 1.06 for ages 15–16, compared to ages 17–18). The strongest effect was related to school performance compared to the best students (school marks 18–20), median odds ratios were 1.31 for marks 15–17, 1.76 for 12–14 and 3.25 for 10–11. Implications for questionnaire design are discussed.     

Separating environmental efficiency into production and abatement efficiency: a nonparametric model with application to US power plants

In this paper we present a new approach to evaluate the environmental efficiency of decision making units. We propose a model that describes a two-stage process consisting of a production and an end-of-pipe abatement stage with the environmental efficiency being determined by the efficiency of both stages. Taking the dependencies between the two stages into account, we show how nonparametric methods can be used to measure environmental efficiency and to decompose it into production and abatement efficiency. For an empirical illustration we apply our model to an analysis of US power plants.     

Further developments in estimation of the largest mean ofK normal populations

We revisit the bounded maximal risk point estimation problem as well as the fixed-width confidence interval estimation problem for the largest mean amongk(≥2) independent normal populations having unknown means and unknown but equal variance. In the point estimation setup, we devise appropriate two-stage and modified two-stage methodologies so that the associatedmaximal risk can bebounded from aboveexactly by a preassigned positive number. Kuo and Mukhopadhyay (1990), however, emphasized only the asymptotics in this context. We have also introduced, in both point and interval estimation problems,accelerated sequential methodologies thereby saving sampling operations tremendously over the purely sequential schemes considered in Kuo and Mukhopadhyay (1990), but enjoying at the same time asymptotic second-order characteristics, fairly similar to those of the purely sequential ones.     

Productivity drivers and market dynamics in the Spanish first division football league

This paper analyses efficiency drivers of a representative sample of Spanish football clubs by means of the two-stage data envelopment analysis (DEA) procedure proposed by Simar and Wilson (J Econ, 136:31–64, 2007). In the first stage, the technical efficiency of football clubs is estimated using a bootstrapped DEA model in order to establish which of them are the most efficient; the ranking is based on total productivity in the period 1996–2004. In the second stage, the Simar and Wilson (J Econ, 136:31–64, 2007) procedure is used to bootstrap the DEA scores with a truncated bootstrapped regression. Policy implications of the main findings are also considered.     

Does school ownership matter? An unbiased efficiency comparison for regions of Spain

The programme for international student assessment (PISA) 2006 Report (OECD, PISA 2006: science competencies for tomorrow’s world, Organisation for Economic Co-operation and Development, Paris in 2007) showed significant differences among Spanish students attending publicly financed schools. Publicly financed schools include entirely public schools and schools that are privately managed but publicly funded. Families with a lower socioeconomic status may self-select into public schools, so a direct efficiency comparison between the two school types could lead to flawed conclusions because of the possible school selection bias. In this paper, we suggest using a propensity score matching approach in order to correctly analyze the impact of school ownership on student performance. After tackling the self-selection problem, we use a stochastic parametric distance function framework to compare student efficiency and productivity in both school types across ten Spanish regions using PISA 2006 data. Furthermore, we propose two original measures to analyze the impact of school ownership on academic performance across regions: the average treatment effect on the treated on the production frontier and the average treatment effect on the treated assuming school inefficiency. We find that, on average, private government-dependent schools are more productive than public schools, although efficiency results across regions are highly divergent.     

On a use of stratified sampling in optimal estimation

Summary Postulating an intra-class correlation structure for a finite population vector of variate — values optimal stratified and unstratified strategies for estimating the total are identified and relative efficiencies noted. Higher efficiency of stratified over unstratified sampling is demonstrated for usual estimators in ppswr case, in particular. In the uncorrelated case appropriately chosen two-stage strategies are observed to fare at par with optimal stratified ones.     

Firm efficiency: Domestic owners,coalitions, and FDI

In this paper we analyze the evolution of firm efficiency in the Czech Republic. Using a large panel of more than 190,000 Czech firm/years we study whether firms fully utilize their resources, how firm efficiency evolves over time, and how firm efficiency is determined by ownership structure. We employ a panel version of a stochastic production frontier model for the period 1996–2007 with time-varying efficiency. We differentiate among various degrees of ownership concentration and domestic or foreign origin. In a two-stage set-up we first estimate the degree of firm inefficiency and then the effect of ownership structure on the distance from the efficiency frontier. Our results support the hypothesis that concentrated ownership is positively related to efficiency. FDI has beneficial effects at the microeconomic level. However, we show that a simple majority is not necessarily the best structure to improve efficiency. We further analyze the effects of ownership coalitions and shed light on many other subtleties of how ownership and the specific industry affect firm efficiency.     

How does stakeholder engagement through environmental,social, and governance affect eco-efficiency and profitability efficiency? Zooming into Apple Inc.'s counterparts

As global ecological degradation intensifies, a trade-off has arisen between environmental protection and production efficiency to achieve sustainable development for the environment, society, and the company itself. However, the potential reverse causality relationship between environmental, social, and governance (ESG) and corporate efficiency may lead to confusion. This study estimates the eco-efficiency of Apple Incorporated's value-chain counterparts in the first stage and creates values and profitability in the second stage of efficiency evaluation. Results obtained from the (i) directional distance function in the two-stage data envelopment analysis (DEA), (ii) additive efficiency decomposition two-stage network DEA model, and (iii) network slacks-based measure model are consistent. That is, Apple counterparts manage more efficient eco-efficiency than profitability efficiency, implying that eco-efficiency is their competitive advantage. We thus also run a regression analysis to examine how the ESG ratings of Apple counterparts explain their eco-efficiency and profitability efficiency. Although the overall ESG rating positively explains the efficiencies, we found that the individual governance rating shows no statistically significant effect. The regression results provide insight for practitioners on the importance of investing in the three aspects of a firm's collective conscientiousness for societal and environmental governance. This paper integrates companies' eco-efficiency and profitability efficiency to resolve the conflict between environmental issues and production efficiency. It also analyzes in depth the effects of ESG and its three individual factors on eco-, profitability, and average efficiencies. The diversity of research methods also provides new ideas for future research related to firm efficiency.     

Estimating school district expenditure functions under conditions of closed-end matching aid

Several studies have used ordinary least squares (OLS) to estimate school district expenditure functions for states with closed-end matching aid. The present paper demonstrates that the estimates of these studies may be inconsistent. A two-stage technique which guarantees consistent estimates is described and is used to estimate the price elasticity of expenditure for Pennsylvania school districts. The two-stage estimates indicate expenditure to be substantially more price-elastic than do the OLS estimates. The two-stage technique is appropriate for estimating any input demand or expenditure function when closed-end matching aid is involved.     

Composition versus decomposition in two-stage network DEA: a reverse approach

A two-stage production process assumes that the first stage transforms external inputs to a number of intermediate measures, which then are used as inputs to the second stage that produces the final outputs. The fundamental approaches to two-stage network data envelopment analysis are the multiplicative and the additive efficiency-decomposition approaches. Both they assume a series relationship between the two stages but they differ in the definition of the overall system efficiency as well as in the way they conceptualize the decomposition of the overall efficiency to the efficiencies of the individual stages. In this paper, we first show that the efficiency estimates obtained by the additive decomposition method are biased, by unduly favouring one stage against the other, while those obtained by the multiplicative method are not unique. Then, we present a novel approach to estimate unique and unbiased efficiency scores for the individual stages, which are then composed to obtain the efficiency of the overall system, by selecting the aggregation method a posteriori. Within the particularity of two-stage processes emerging from the conflicting role of the intermediate measures, we develop an envelopment model to locate the efficient frontier whose derivation from our primal multiplier efficiency assessment model is effectively justified. The results derived from our approach are compared with those obtained by the aforementioned basic methods on experimental data as well as on test data drawn from the literature. Similarities and dissimilarities in the results are rigorously justified.     

On the Determinants of School District Efficiency: Competition and Monitoring

A number of researchers have asserted that inefficiency in the U.S. school system arises from a lack of incentives for public schools to behave efficiently. This paper uses a Shephard input distance function to model educational production, and a switching-regressions estimation to explore the relationship between school district efficiency and two existing incentive mechanisms—competition and voter monitoring. We find evidence that ease of monitoring enhances both technical and allocative efficiency of urban school districts, and that increased competition reduces allocative inefficiency in communities above a competitive threshold. We find no evidence that competition is related to technical inefficiency.     

Estimation and inference in two-stage,semi-parametric models of production processes

Many papers have regressed non-parametric estimates of productive efficiency on environmental variables in two-stage procedures to account for exogenous factors that might affect firms’ performance. None of these have described a coherent data-generating process (DGP). Moreover, conventional approaches to inference employed in these papers are invalid due to complicated, unknown serial correlation among the estimated efficiencies. We first describe a sensible DGP for such models. We propose single and double bootstrap procedures; both permit valid inference, and the double bootstrap procedure improves statistical efficiency in the second-stage regression. We examine the statistical performance of our estimators using Monte Carlo experiments.     

Transition, the Evolution of Stock Market Efficiency and Entry into EU: The Case of Romania

In this paper we demonstrate that the measurement of stock market efficiency is an important activity in establishing whether eastern European countries satisfy the Copenhagen Criteria for EU membership. Specifically, we argue that developing an efficient stock market should be an important policy focus for countries with aspirations to join the EU as it helps to demonstrate the existence of a functioning market economy. We illustrate this issue by examining the evolution of stock market efficiency in the Bucharest Stock Exchange from mid-1997 to September 2002. We use a GARCH model on daily price data and model the disturbances using the Student-t distribution to allow for ‘fat-tails’. We find strong evidence of inefficiency in the Bucharest Stock Exchange in that the lagged stock price index is a significant predictor of the current price index. This result is robust to the inclusion of variables controlling for calendar effects of the sort that have been observed in more developed stock markets. The level of inefficiency appears to diminish over time and we find evidence consistent with stock market efficiency in Romania after January 2000.     

Demutualization,outsider ownership,and stock exchange performance: empirical evidence

We employ a balanced panel data set of 28 stock exchanges to disentangle the effects of demutualization and outsider ownership on the operative performance of stock exchanges. For this purpose we calculate in a first step individual efficiency and factor productivity values via Data Envelopment Analysis. In a second step we regress the derived values on variables that—amongst others—represent the different governance regimes of exchanges in order to examine technical efficiency and factor productivity differences between (1) mutuals, (2) demutualized but customer-owned exchanges, and (3) publicly listed and thus at least partly outsider-owned exchanges. We find evidence that demutualized exchanges exhibit higher technical efficiency than mutuals. However, they perform relatively poor as far as productivity growth is concerned. Furthermore, we find no evidence that publicly listed exchanges possess higher efficiency and productivity values than demutualized exchanges with a customer-dominated structure.      

Evaluating efficient public good provision: Theory and evidence from a generalised conditional efficiency model for public libraries

Provision of most public goods (e.g., health care, libraries, education, police, fire protection, utilities) can be characterized by a two-stage production process. In the first-stage, basic inputs (e.g., labor and capital) are used to generate service potential (e.g., opening hours, materials), which is then, in the second-stage, transformed into observed outputs (e.g., school outcomes, library circulation, crimes solved). As final outputs are also affected by demand-side factors, conflating both production stages likely leads to biased inferences about public productive (in)efficiency and its determinants. Hence, this paper uses a specially tailored, fully non-parametric efficiency model allowing for both outlying observations and heterogeneity to analyse efficient public good provision in stage one only. We thereby employ a dataset comprising all 290 Flemish public libraries. Our findings suggest that ideological stance of the local government, wealth and density of the local population and source of library funding (i.e., local funding versus intergovernmental transfers) strongly affect library productive efficiency.