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2019 International Conference on Energy, Power, Environment and Computer Application (ICEPECA 2019) ISBN: 978-1-60595-612-1 Studies on the Efficiency Characteristics of the Economic Development in Fujian Province Based on DEA and Malmquist Index Hong LEI and Xue-yan HUANG School of Business Administration, Jimei University, Yinjiang Road No. 185, Xiamen, Fujian, P.R. China Keywords: Data envelopment analysis, Economic efficiency, Malmquist productivity Index. Abstract. In this paper, the efficiency characteristics of the economic development of nine cities in Fujian Province are chosen as the research object, collecting 2001-2014 of nine cities in Fujian input-output data, using data envelopment analysis (DEA) combined with Malmquist productivity index, and the technical efficiency, pure technical efficiency and scale efficiency and total factor productivity are calculated. According to the calculation results, the efficiency characteristics of economic development in different areas are analyzed, and the nine cities are divided into three types according to the efficiency characteristics, and the corresponding policy suggestions are proposed. Introduction Fujian province is the starting point of the maritime Silk Road. Since the policy of reform and opening, especially the accession to the WTO, remarkable results have been achieved in the economic development in Fujian; GDP increased from 407 billion Yuan in 2001 to 2405 billion Yuan in 2014, ranking eleventh in the country. At the same time, in the process of economic development, the unbalanced problems in regional development still exist, and the economic development is uneven in efficiency. It is an important problem to analyze the economic development efficiency of various regions in Fujian, to seek the countermeasures for improving the economic efficiency and to promote the balanced development of various regions. In this paper, the DEA is used to calculate technical efficiency, pure technical efficiency, scale efficiency and total factor productivity of economic development in Fujian in 2001-2014, which provides a useful reference for the sustained and healthy development in Fujian Province economy in the future. Research Methods and Models Data Envelopment Analysis DEA is a kind of "data-oriented" method, which is used to measure the efficiency of decision making units with multiple inputs and multiple outputs. DEA has a unique advantage in the efficiency evaluation, it does not need estimated parameters in the prior, nor make data dimensionless, also in a great extent avoid the influence of subjective judgment of decision maker's on the evaluation results. T T CCR model: min (e s e s ) n n s.t. X j j s X 0 ,Y j j s Y0 ( j 0, j 1,2,n;s 0, s 0) j1 j1 BBC model: min[ (eT s eT s )] n n n s.t. X j j s X 0 ,Y j j s Y0 , j 1( j 0, j 1,2,,n;s 0, s 0) j1 j1 j1 λ In formula, j is ratio of the j-th DMU in the effective combination of reconstruction DMU is DMU relative to the combination of decision making units i ; n is the total of DMU; m and t 439 X respectively is input (resource consumption) and output (products); ij is the i-th resource input Y for the j-th DMU; rj is the r-th output for the j-th DMU ; S , S are the slack variables, that respectively is on behalf of the redundancy of the input and the deficiency of output; ε is Archimedean infinitesimal, or ε = 10-6 ; θ is a valid value for the DMU, namely relative efficiency of input relative to output. Malmquist Productivity Index Malmquist productivity index is used to measure the Total factor productivity (TFP), and TFP is the economic growth rate caused by other input factors except the labor and capital, often seen as indicators of the progress of science and technology. The sources of TFP include technological progress, organizational innovation, specialization and production innovation, and so on. Malmquist productivity index is widely used in the research of the change of production efficiency. The index TFP can not only be used to measure dynamic change of Total Factor Productivity ( ch ), and this change is further decomposed into three important components, that is technological progress TE PTE SE change ( ch ), pure technical efficiency change ( ch ) and scale efficiency change ( ch ). TFP TE PTE SE Namely, ch ch ch ch Choice to Index and Data Sources Choice to index. Using DEA model to evaluate the efficiency of regional economic development, the key is to choose the index system of input and output. According to the scholar's research[1]-[7], and considering the characteristics of economic development in Fujian, this paper selects input indicators as follow: the fixed assets investment in the whole society (ten thousand Yuan) and the fiscal expenditure (ten thousand Yuan); output indicators selected as follow: GDP (100 million Yuan), the per capita disposable income of urban residents (Yuan) and the per capita net income of rural residents (Yuan). Data sources. The data were chosen from “the Fujian statistical yearbook” of each year and “statistical yearbook” of nine cities in Fujian in 2001-2014. The DEAP2.1 software is used to calculate and get the efficiency value. Results and Explanations Explanations to Economic Efficiency Status in Different Regions of Fujian Table 1. Technical efficiency values of 9 cities in Fujian in 2001-2014. year Fuzhou Xiamen Putian Sanming Quanzhou Zhangzhou Nanping Longyan Ningde mean 2001 0.809 0.607 1.000 0.901 1.000 0.954 0.897 0.932 0.757 0.873 2002 0.794 0.565 1.000 1.000 1.000 1.000 0.817 0.875 0.939 0.888 2003 0.860 0.651 1.000 0.819 1.000 1.000 0.799 0.884 0.804 0.868 2004 0.897 0.641 1.000 0.876 0.993 1.000 0.798 1.000 0.784 0.888 2005 0.854 0.660 1.000 0.817 1.000 0.940 0.767 1.000 0.837 0.875 2006 0.834 0.512 1.000 0.811 1.000 0.893 0.780 1.000 1.000 0.870 2007 0.811 0.509 1.000 0.754 1.000 0.925 0.732 0.879 1.000 0.846 2008 0.772 0.619 1.000 0.910 1.000 0.863 0.749 0.896 1.000 0.868 2009 0.781 0.757 1.000 0.885 1.000 0.804 0.817 0.847 1.000 0.877 2010 0.774 0.857 1.000 0.867 1.000 0.769 0.828 0.842 1.000 0.882 2011 0.723 0.968 1.000 0.855 1.000 0.787 0.845 0.862 1.000 0.893 2012 0.784 1.000 1.000 0.825 1.000 0.781 0.881 0.864 1.000 0.904 2013 0.717 1.000 1.000 0.850 1.000 0.823 0.842 0.873 1.000 0.901 2014 0.753 1.000 1.000 0.856 1.000 0.843 0.847 0.882 1.000 0.909 From the point of view of the efficiency of economic development in Fujian, the technical efficiency values are above 0.8 in 2001-2014, and are at a higher level. The technical efficiency value is in a stable state with only small fluctuations in 2001-2006. Respectively, the technical 440 efficiency values were 0.846 and 0.868 in 2007-2008, at the lowest value in14 years. The value of technical efficiency is basically in an upward trend in 2009-2014, which reached the highest value in 14 years at 2014. It showed that the efficiency of economic development in Fujian is in the rising stage, and the development trend is good. Results show that the technical efficiency levels of Putian were 1.000.Quanzhou in 2004 did not achieve the best technical efficiency. Because of the technical efficiency of Ningde is 1.000 in 2006, which indicates that the development trend is good. In contrast, Fuzhou and Xiamen are the most economically developed areas in Fujian, but the annual average value of technical efficiency is at a low level. The technical efficiency value is non-effective due to non-effective of pure technical efficiency and scale efficiency, which can be optimized by adjustment in the long-term. Table 2. Pure technical efficiency values of economic efficiency of 9 cities in Fujian in 2001-2014. year Fuzhou Xiamen Putian Sanming Quanzhou Zhangzhou Nanping Longyan Ningde mean 2001 0.814 1.000 1.000 1.000 1.000 0.957 0.903 0.938 0.767 0.931 2002 0.798 1.000 1.000 1.000 1.000 1.000 0.833 0.877 0.953 0.940 2003 0.864 1.000 1.000 0.994 1.000 1.000 0.822 0.885 0.816 0.931 2004 0.903 1.000 1.000 0.881 1.000 1.000 0.825 1.000 0.810 0.935 2005 0.854 1.000 1.000 0.945 1.000 0.940 0.805 1.000 0.903 0.939 2006 0.837 1.000 1.000 0.969 1.000 0.894 0.838 1.000 1.000 0.949 2007 0.812 1.000 1.000 0.754 1.000 0.967 0.792 0.979 1.000 0.923 2008 0.775 1.000 1.000 0.918 1.000 0.897 0.817 0.933 1.000 0.927 2009 0.793 1.000 1.000 0.909 1.000 0.824 0.891 0.848 1.000 0.918 2010 0.782 1.000 1.000 0.889 1.000 0.770 0.911 0.843 1.000 0.911 2011 0.725 1.000 1.000 0.873 1.000 0.790 0.889 0.865 1.000 0.905 2012 0.786 1.000 1.000 0.849 1.000 0.787 0.948 0.866 1.000 0.915 2013 0.718 1.000 1.000 0.875 1.000 0.826 0.900 0.880 1.000 0.911 2014 0.755 1.000 1.000 0.887 1.000 0.851 0.909 0.890 1.000 0.921 From the point of view of average, the pure technical efficiency of Fujian in the 2001-2014 is at a high level, the minimum value is 0.905, there are fluctuations in some years, but the volatility is small.