A comparative evaluation of operational efficiency of wood industry using data envelopment analysis and Malmquist productivity index

Abstract

The wood industry, as a traditional sector, represents a very important part of the economy in terms of ensuring a sustainable development of society and transition to a low-carbon society in both countries studied, Slovenia and Croatia. For its further development, it is crucial to know the current position of the industry. The best way to achieve this is an analysis of financial data and international comparative evaluation of its operational efficiency. The aim of the research is to compare the relative efficiency of the wood industry using Data Envelopment Analysis (DEA) and the Malmquist Productivity Index (MI), focusing on the Slovenian and Croatian wood industry sectors (C16 and C31) for a recent five-year period (from 2013-2017). With this purpose, the combined measure DEA/MI was applied. The analysis includes only the highest rated companies with more than fi ve employees, divided into 12 clusters regarding the company size. As a result, it was established that clusters CRO-C31- micro, CRO-C16-micro and SI-C16-larger have the highest operational efficiency, due to the effects of different financial indicators, especially activity and liquidity ratios. In general, within the grouped clusters regarding country and subsector, groups SI-C16 and CRO-C31 achieve the highest values for the average of weighted score of efficiency, while CRO-C16 achieves the lowest values.

Efficiency of Micro and Small Wood-Processing Enterprises in the EU—Evidence from DEA and Fractional Regression Analysis

“…One of the most applied nonparametric linear approaches is Data Envelopment Analysis (DEA) [24] that "envelopes" the observed input and output data for each Decision-Making Unit (DMU) [26]. DEA is among the widely used methodologies when analysing the efficiency of wood-processing enterprises [27][28][29][30][31][32][33][34].…”

The Long-Term Capital-Market Performance of the Forestry Sector: An Investors’ Perspective

“…Since more pressure is going to be directed toward forests in terms of usage for energy (e.g., firewood from a natural and renewable source) and land-use change (e.g., conversion into agricultural land for food production), there is a possibility that those processes could result in forest destruction and degradation. To prevent this from happening it is of great importance that societal needs (quantity and quality of wood demand in a certain period and the specific region), forestry performances (forest growing and management within their production potential for adequate supply on the market), and wood-processing industry performances (wood utilization at a higher level by using innovative technologies and wood reusing) are balanced [12][13][14]. In other words, the need to better understand how those segments can cooperate more preferably is becoming important due to customers' requests [15,16], the disbalance between supply and demand [14,17], and changing conditions in which forests can be grown [18].…”