Copula Approach to Multivariate Energy Efficiency Analysis

Data envelopment analysis (DEA) is a method that finds the effectiveness of an existing system using a number of input and output variables. In this study, we obtained energy efficiencies of construction, industrial, power, and transportation sectors in OECD countries for 2011 using DEA. It is possi...

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Bibliographic Details
Published in:Asia-Pacific journal of operational research 2022-12, Vol.39 (6)
Main Authors: Sözen, Mervenur, Cengiz, Mehmet Ali
Format: Article
Language:English
Subjects:
Data analysis
Data envelopment analysis
Energy efficiency
Energy industry
Multivariate analysis
Operations research
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Summary:Data envelopment analysis (DEA) is a method that finds the effectiveness of an existing system using a number of input and output variables. In this study, we obtained energy efficiencies of construction, industrial, power, and transportation sectors in OECD countries for 2011 using DEA. It is possible to achieve the efficiencies in different sectors. However, we aim to find joint energy efficiency scores for all sectors. One of the methods proposed in the literature to obtain joint efficiency is network data envelopment analysis (network DEA). Network DEA treats sectors as sub-processes and obtains system and process efficiencies through optimal weights. Alternatively, we used a novel copula-based approach to achieve common efficiency scores. In this approach, it is possible to demonstrate the dependency structure between the efficiency scores of similar qualities obtained with DEA by copula families. New efficiency scores are obtained with the help of joint probability distribution. Then, we obtained joint efficiency scores through the copula approach using these efficiency scores. Finally, we obtained the joint efficiency scores of the same sectors through network DEA. As a result, we compared network DEA with the copula approach and interpreted the efficiencies of each energy sector and joint efficiencies.
ISSN:0217-5959
1793-7019
0217-5959
DOI:10.1142/S0217595921500421