Efficiency differences of government investment projects: an application of a DEA and Tobit analysis

Abstract

Previous studies have evaluated the investment efficiency of the government from a macro perspective, but few studies focus on specific projects with government investment. Therefore, this paper presents a method that combines data envelopment analysis and Tobit regression, which highlights the sources of funds, social benefits and influencing factors. It concludes that the overall efficiency of government investment projects (GIPs) is very high, but the excessive input and insufficient output are widespread and big improvement spaces exist; the public requirements rank first of all the influencing factors. This paper can provide references to guide the GIPs to gradually obtain better investment efficiencies.

The Efficiency Analysis of National R&D Planning for the Field of Precision Medicine in Korea

“…First, the advanced study on the efficiency analysis of investment is briefly as follows. Wu et al analyzed the efficiency difference in government investment projects [9]. International comparisons of efficiency in the public sector have been analyzed using DEA [10]; the study presents seven socio-economic indicators and 17 sub-indicators that can be measured in public sector performance.…”

“…To apply the DEA method, the appropriate input and output variables must first be selected. In the analysis of the efficiency of government investment projects, Wu et al used the following as input variables: financial input in the early stage, financial input from the government, financial input from society, and personnel input from the government; social benefits and economic benefits were used as output variables [9]. Lovre et al conducted an international comparison of efficiency in public sectors; in this study, socio-economic indicators that affect the growth of public sector performance were categorized into seven areas: administration, education, healthcare, infrastructure, income distribution, stability, and economic performance [10].…”