Measuring the Efficiency of Economic Growth towards Sustainable Growth with Grey System Theory

Abstract

In the paper, a new indicator exemplifying the conversion efficiency of expenditures towards economic growth into results pertaining to sustainable development, dubbed the “Synthetic Efficiency Indicator for Economic Growth” (hereinafter: “SEI-EG”) has been proposed. The inspiration for proposing such an indicator was the identification of the lack of connections between research on economic convergence and the research area connected with sustainable growth category. It was assumed that, in the first place, outcomes of the proposed convergence will be visible in developed economies, represented by EU15 member states. The set goal was to provide an answer to the question of difference between EU15 member states with respect to efficiency of converging expenditures exemplifying economic growth into results pertaining to sustainable growth. The research was conducted for 2016–2018 using Grey System Theory. With the use of the elaborated indicator, the authors created a ranking list of countries based on the efficiency of economic growth towards sustainable growth criterion. The conducted research proved that, in general, the smaller EU member states are characterized by significantly higher efficiency of converging expenditures exemplifying economic growth into results pertaining to sustainable development in the researched area. Among the countries with large economies, only Germany showed efficiency comparable to smaller ones.

The Efficiency of Economic Growth for Sustainable Development—A Grey System Theory Approach in the Eurozone and Other European Countries

“…In economic theory, efficiency is commonly defined as the ratio of achieved results to the expended resources within a set of analyzed entities [28]. This article introduces the concept of a new indicator that illustrates the efficiency of transforming inputs, such as GDP (per capita in PPS) and general government gross debt (percentage of GDP), into outcomes associated with sustainable development in the area of industry, innovation, and infrastructure [29,30]. The authors have termed this indicator the SEI-EG.…”

Efficiency ranking of economic growth toward sustainable growth with grey system theory: the case of small countries in advanced and emerging economies

“…The measurement of the efficiency of transforming growth-related inputs into sustainability-related outputs for the countries constituting the research group in the article was conducted using the author's "Synthetic Efficiency Indicator for Economic Growth" ("SEI-EG") -based on grey systems theory (especially whitening functions) [Nowak et al, 2020[Nowak et al, , 2021. The determination of the described indicator can be presented as a research procedure consisting of seven steps [Kokocińska et al, 2020].…”

Application of Mathematical Models to Assess the Impact of the COVID-19 Pandemic on Logistics Businesses and Recovery Solutions for Sustainable Development

“…Grey prediction theory is a multidisciplinary forecasting science that has been applied in almost all sciences. Since its introduction, it has been applied by scientific works around the world [15][16][17][18][19]. Fan et al, (2018) used a Grey forecasting model to forecast natural gas demand in China [20].…”