Using Data Envelopment Analysis: A Case of Universities

Abstract

Abstract The aim of this article is to analyse appropriateness and adequacy of use of Data Envelopment Analysis (DEA) in several research papers dealing with effectiveness of economy of universities. The Data Envelopment Analysis is an interesting method used for evaluation of technical efficiency of production units. Comparison is the basic method of this article. At the beginning, basic methodological questions of measurement and evaluation of efficiency are analysed, including definitions of terms efficiency and effectiveness, ways of measurement and formulation of appropriate indicators. Based on the given perquisites for measurement and evaluation of efficiency five articles on evaluation of efficiency of universities using DEA method, published in Canada, Australia, Great Britain, Germany and Spain in 1998 - 2008, will be assessed. DEA is able to use more parameters of input and output to evaluate which of units under examination is the most effective, and to compare other units with it. For this, it is necessary to have a homogenous group of units. The result of assessment shows that all the examined studies focused rather on way of calculation then the point and reason of measurement. The articles contain a discussion concerning choice of appropriate indicators but do not at all deal with the issue of its construction using interventional logic; the articles do not contain any comparison of objectives of the particular universities. Evaluation of efficiency of universities is a social construct and it will always be a subjective matter related to objectives of a particular stakeholder. This fact explains how to approach the evaluation of efficiency: it is necessary to set an objective function that means to set the objectives of a given stakeholder and his preferred results and outputs. All the studies lack this basic logic.