Modelling the Performance of Australian Hotels: A DEA Double Bootstrap Approach

Abstract

This study uses the data envelopment analysis (DEA) double bootstrap approach to assess the technical efficiency standing of Australian hotels. Two inputs and six outputs were used in the analyses for the period 2004–2007. The empirical results indicate that the DEA bootstrap approach corrects for the bias inherent in traditional DEA models. The results show that the average technical efficiency of Australian hotels has improved gradually from 76.17% in 2004 to reach its highest level of 80.84% in 2007. The results also indicate that the key determinants of the technical efficiency of Australian hotels are the number of years in business, location, star rating and physical size. The implications of the results are discussed.