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A two-stage DEA approach for environmental efficiency measurement

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Abstract

The slacks-based measure (SBM) model based on the constant returns to scale has achieved some good results in addressing the undesirable outputs, such as waste water and water gas, in measuring environmental efficiency. However, the traditional SBM model cannot deal with the scenario in which desirable outputs are constant. Based on the axiomatic theory of productivity, this paper carries out a systematic research on the SBM model considering undesirable outputs, and further expands the SBM model from the perspective of network analysis. The new model can not only perform efficiency evaluation considering undesirable outputs, but also calculate desirable and undesirable outputs separately. The latter advantage successfully solves the "dependence" problem of outputs, that is, we can not increase the desirable outputs without producing any undesirable outputs. The following illustration shows that the efficiency values obtained by two-stage approach are smaller than those obtained by the traditional SBM model. Our approach provides a more profound analysis on how to improve environmental efficiency of the decision making units.

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Acknowledgments

We appreciate the support of Program for New Century Excellent Talents in University (No. NCET-12-0595), National Natural Science Foundation of China (No. 71171001), Humanity and Social Science Youth Foundation of Ministry of Education of China (No. 10YJC630208), Key Foundation of Natural Science for Colleges and Universities in Anhui, China (No. KJ2011A001), Soft Science Foundation of Anhui, China (No. 12020503063) and Key Foundation of National research in Statistics of China (No. 2011LZ023).

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Authors and Affiliations

  1. School of Statistics and Applied Mathematics, Anhui University of Finance and Economics, Bengbu, 233030, China

    Malin Song

  2. School of Economics, NanKai University, Tianjin, 300071, China

    Shuhong Wang

  3. Business School, East China University of Political Science and Law, Shanghai, 201620, China

    Wei Liu

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  1. Malin Song
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  2. Shuhong Wang
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  3. Wei Liu
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Correspondence to Malin Song.

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Song, M., Wang, S. & Liu, W. A two-stage DEA approach for environmental efficiency measurement. Environ Monit Assess 186, 3041–3051 (2014). https://doi.org/10.1007/s10661-013-3599-z

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  • DOI: https://doi.org/10.1007/s10661-013-3599-z

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