The technology gap and efficiency measure in WEC countries: Application of the hybrid meta frontier model

This study develops the hybrid meta frontier DEA model for which inputs are distinguished into radial inputs that change proportionally and non-radial inputs that change non-proportionally, in order to measure the technical efficiency and technology gap ratios (TGR) of four different regions: Asia, Africa, America, and Europe. This paper selects 87 countries that are members of the World Energy Council from 2005 to 2007. The input variables are industry and population, while the output variances are gross domestic product (GDP) and the amount of fossil-fuel CO2 emissions.The result shows that countries’ efficiency ranking among their own region presents more implied volatility. In view of the Technology Gap Ratio, Europe is the most efficient of any region, but during the same period, Asia has a lower efficiency than other regions. Finally, regions with higher industry (or GDP) might not have higher efficiency from 2005 to 2007. And higher CO2 emissions or population also might not mean lower efficiency for other regions. In addition, Brazil is not OECD member, but it is higher efficiency than other OECD members in emerging countries case. OECD countries are better efficiency than non-OECD countries and Europe is higher than Asia to control CO2 emissions. If non-OECD countries or Asia countries could reach the best efficiency score, they should try to control CO2 emissions.