Technical efficiency and the competitive behavior of hospitals

This paper examines whether the competitive behavior of hospitals influences the extent to which their productive efficiency deviates from best-practice standards. An index of technical inefficiency is constructed by means of Data Envelopment Analysis (DEA) for 189 acute-care hospitals in the State of Florida in 1989. A regression model is then specified that estimates the impact of competitive dynamics in local hospital markets over the period 1982–1988 on these 1989 DEA efficiency scores, controlling for a set uf internal and external constraints on managerial decision making. Among other things, the empirical analysis shows that these ratings are systematically accounted for by both the nature and vigor of hospital competition, with price leaders in highly competitive markets in particular shown to be more efficient. The public policy implications of these findings are discussed.     

Bank ownership and cost efficiency: New empirical evidence from Russia

This paper investigates the cost efficiency of Russian banks with regard to their heterogeneity in terms of ownership form, capitalization and asset structure. Using bank-level quarterly data over the period 2005–2013, we perform stochastic frontier analysis (SFA) and compute cost efficiency scores at the bank and bank group levels. We deduct from gross costs the negative revaluations of foreign currency items generated by official exchange rate dynamics rather than by managerial decisions. The results indicate that the core state banks, as distinct from other state-controlled banks, were nearly as efficient as private domestic banks during and after the crisis of 2008–2009. Foreign banks appear to be the least efficient market participants in terms of costs, which might reflect their lower (and decreasing over time) penetration of the Russian banking system. We further document that the group ranking by cost efficiency is not permanent over time and depends on the observed differences in bank capitalization and asset structure. We find that foreign banks gain cost efficiency when they lend more to the economy. Core state banks, conversely, lead in terms of cost efficiency when they lend less to the economy, which can result from political interference in their lending decisions in favor of unprofitable projects Private domestic banks that maintain a lower capitalization significantly outperform foreign banks and do not differ from the core state banks in this respect.     

Capacity,competiton and efficiency in hospitals: A nonparametric approach

The purpose of this paper is to provide a new,multiple output measure of plant capacity which we use to analyze the performance of hospitals in different competitive environments. To evaluate each hospital's plant capacity, we employ a nonparametric (linear programming) framework. The resulting measure of capacity can be determined from observed inputs and outputs and is based on the best practice performance of all hospitals in the sample. This methodology is closely related to Farrell-type measures of efficiency and, as a by-product, yields information on efficiency of individual hospitals. This technique imposes no prespecified functional form and allows for multiple outpus (to account for differences in case-mix). We apply this methodological approach to a sample of hospitals in Michigan. Our results are used to compare capacity utilization and efficiency of hospitals across different competitive environments.The refereeing process of this paper was handled by R. Kopp.     

Technical efficiency in farming: a meta-regression analysis

A meta-regression analysis including 167 farm level technical efficiency (TE) studies of developing and developed countries was undertaken. The econometric results suggest that stochastic frontier models generate lower mean TE (MTE) estimates than non-parametric deterministic models, while parametric deterministic frontier models yield lower estimates than the stochastic approach. The primal approach is the most common technological representation. In addition, frontier models based on cross-sectional data produce lower estimates than those based on panel data whereas the relationship between functional form and MTE is inconclusive. On average, studies for animal production show a higher MTE than crop farming. The results also suggest that the studies for countries in Western Europe and Oceania present, on average, the highest levels of MTE among all regions after accounting for various methodological features. In contrast, studies for Eastern European countries exhibit the lowest estimate followed by those from Asian, African, Latin American, and North American countries. Additional analysis reveals that MTEs are positively and significantly related to the average income of the countries in the data set but this pattern is broken by the upper middle income group which displays the lowest MTE.

Insider ownership and firm performance in Taiwan's electronics industry: a technical efficiency perspective

This paper applies agency theory to explore the relationship between insider stock ownership and firm performance, particularly in terms of technical efficiency. Insiders are further classified into executives, outside directors, and large shareholders to conduct a detailed study. Six‐year (1996–2001) panel data of 416 Taiwanese listed electronics firms are examined by the stochastic production frontier approach. It is observed that raising the executive‐to‐insider holding ratio first causes a decrease and then an increase in technical efficiency, forming a U‐shaped relationship. However, the board‐to‐insider holding ratio is negatively associated with technical efficiency. The results indicate that equity ownership of top officers in high‐tech firms should be encouraged to enhance firm productivity. Copyright © 2005 John Wiley & Sons, Ltd.     

Class diversification,economic growth and urban sprawl: evidences from a pre-crisis European city

Economic expansion indirectly promotes class diversification at the neighbourhood scale with a consequent reduction of social divides at the regional scale. To verify this working hypothesis, the present study investigates class diversification at both spatial scales in a Mediterranean city (Athens, Greece) using the European Socioeconomic Classification based on population census data referring to 1991–2001, a phase of economic expansion and intense urban sprawl preceding the 2004 Olympic games. Results of multivariate analysis and diversity indexes outline a local-scale social mix associated to suburban expansion, and regional-scale class segregation, reflecting an increasing polarization in affluent and economically deprived urban districts. The contrasting pattern at the two spatial scales results in a complex social geography with class diversification and moderate changes over time in the economic spatial divide between urban and neighbouring rural areas. These findings contribute to design scale-dependent policies reducing social inequalities and improving quality of life in urban areas. Future paths for socio-spatial processes were delineated for sprawling metropolitan regions under economic expansion and discussed in the light of future demographic trends in both developed and emerging countries.     

Training and economic density: Some evidence form Italian provinces

In this paper we use a search and matching model to investigate the economic relationship between training and local economic conditions. We identify two aspects of this relationship going in opposite directions: on the one hand, the complementarity between local knowledge spillovers and training generates a positive correlation between training and local density; on the other hand, higher wages and labor turnover in denser areas reduce training. Overall the relationship can be either positive or negative, depending on the relative strength of these two effects. Our empirical analysis, based on a sample of Italian firms, shows that training is lower in provinces with higher labor market density, measured as the number of employees per squared kilometer.     

Deposit structure,market discipline,and ownership type: Evidence from Indonesia

In this paper, we extend the literature on the discipline imposed by depositors on banks by disentangling the impact of macro risk and micro risk. We also take advantage of a unique dataset in which depositors are split into different categories of deposit size in different types of banks (bank ownership structure). We consider the Banking Stability Index, which is used by the Indonesia Deposit Insurance Corporation as a dashboard to monitor banking stability at the country level as well as individual stability measures such as the Z-score. Using monthly data from 2005 to 2013, our findings show that both macro and micro levels of risk are considered by depositors to discipline banks. Large uninsured depositors are more effective at disciplining banks, highlighting the credibility of the insurance system that is in place. Bank ownership type also matters in explaining the difference in market discipline by depositors.     

Vertical integration vs. specialization: a nonparametric conditional efficiency estimate for the global semiconductor industry

Journal of Productivity Analysis - This paper applies a two-stage nonparametric approach to compare companies operating in different business models in the global semiconductor industry. Using...     

Electoral accountability and local government efficiency: quasi-experimental evidence from the Italian health care sector reforms

This paper evaluates the effect of two policy changes on the efficiency of Italian regional governments in the provision of health care services: first a change in the electoral system, second a process of fiscal decentralisation. The paper provides two main contributions: (1) a comprehensive analysis of the two main reforms that involved Italian regional governments and the health care sector during the 1990s, (2) the evaluation of the impact of the electoral reform in a quasi-experimental setting. Final results are in line with recent theoretical predictions that show a positive relationship between government efficiency and the electoral accountability enhanced by institutions such as electoral rules and fiscal decentralisation.     

Technical efficiency with multi-output,heterogeneous production: a latent class,distance function model of english football

This study combines the output distance function approach with a latent class model to estimate technical efficiency in English football in the presence of productive heterogeneity within a stochastic frontier analysis framework. The distance function approach allows the researcher to estimate technical efficiency including both on-field and off-field production, which is important in the case of English football where clubs are generally thought to maximize something other than profit. On-field production is measured using total league points, and off-field production is measured using total revenue. The data set consists of 2177 club-level observations on 88 clubs that competed in the four divisions of professional football in England over the 29-season period from 1981/82 to 2009/10. The results show evidence of three separate productivity classes in English football. As might be expected, technical efficiency estimated using the latent class model is, on average, higher than technical efficiency using an alternative method which confines heterogeneity to the intercept coefficient. Specifically, average efficiency for the sample is 87.3 and 93.2% for the random-intercept model and the latent class model respectively.     

Technical efficiency of Norwegian banks: The non-parametric approach to efficiency measurement

The nonparametric frontier methodology is applied to a sample of banks, where output levels are measured either by the number of accounts and their average size, or by the total balances of the accounts. The efficiency rankings of individual banks are found to depend substantially on our choice of output metric, whereas the estimated size of potential productivity improvements in the banking sector are less affected. The results on economies of scale are also largely unchanged.The refereeing process of this paper was handled through S. Grosskopf.     

The effect of foreign ownership on SMEs performance: An efficiency analysis perspective

This paper uses both Data Envelopment Analysis (DEA) and Free Disposal Hull (FDH) models in order to determine different performance levels in a sample of 353 foreign equities operating in the Greek manufacturing sector. Particularly, convex and non-convex models are used alongside with bootstrap techniques in order to determine the effect of foreign ownership on SMEs’ performance. The study illustrates how the recent developments in efficiency analysis and statistical inference can be applied when evaluating performance issues. The analysis among the foreign equities indicates that the levels of foreign ownership have a positive effect on SMEs’ performance.     

Marital history and home ownership: Evidence from Australia

The relative cost of owning and renting housing and housing affordability have been clearly established as important determinants of home ownership. But the roles of marital status and history have been largely ignored. In this paper we show that both current marital status and past history affect ownership. Past history matters because wealth accumulation is greater among couple households than singles owing largely to economies of scale in housing consumption. Moreover, wealth is lost upon divorce. In effect, past marital history affects the affordability of owner housing. This result is shown in the estimation of model explaining wealth, leverage and tenure choice using Australian datasets.     

Technical efficiency during economic reform in Nicaragua: evidence from farm household survey data

This paper employs a translog stochastic frontier model to examine technical efficiency of maize and bean farmers in two selected regions of Nicaragua using farm-level survey data for the 1994–1995 crop year. The average technical efficiency levels are 69.8 and 74.2% for maize and beans, respectively. The results from the maize and beans translog frontier functions show that farmers’ human capital represented by the level of schooling, access to formal credit and farming experience represented by age contribute positively to production efficiency, while farmers’ participation in non-farm employment tends to reduce production efficiency.     

Efficiency of hospitals in the Czech Republic: Conditional efficiency approach

Journal of Productivity Analysis - This paper estimates the cost efficiency of 81 general hospitals in the Czech Republic during 2006–2010. We employ the conditional order-m approach to...     

Patterns of corporate governance and technical efficiency in Italian manufacturing

The purpose of this paper is to analyse the relationship between the corporate governance system and technical efficiency in Italian manufacturing. We use a non‐parametric frontier technique (DEA) to derive technical efficiency measures for a sample of Italian firms taken from nine manufacturing industries. These measures are then related to the characteristics of the corporate governance system. Two of these characteristics turn out to have a positive impact on technical efficiency: the percentage of the company shares owned by the largest shareholder and the fact that a firm belongs to a pyramidal group. Interestingly, a trade‐off emerges between these influences, in the sense that one is stronger in industries where the other is weaker. Copyright © 2007 John Wiley & Sons, Ltd.     

Electronic medical record use and efficiency: A DEA and windows analysis of hospitals

We use data envelopment analysis (DEA) to examine the relationship between hospital electronic medical record (EMR) use and efficiency in a national sample of acute care hospitals. Data sources include the American Hospital Association (AHA), Health Information Management Systems Society (HIMSS), and Case Mix Index. Using two research approaches including a retrospective, cross-sectional design and a first differencing repeated measures design, we find limited evidence that EMRs can improve hospital efficiency. Small hospitals may benefit in the area of efficiency through EMR use, but medium and large hospitals generally do not demonstrate such a difference. Likewise, there does not appear to be a significant increase in efficiency over time associated with EMRs when compared to the efficiency of hospitals without such documentation.