Efficiency Evaluation of Regional Sustainable Innovation in China: A Slack-Based Measure (SBM) Model with Undesirable Outputs

An efficiency evaluation of China's regional sustainable innovation, evaluating industrial waste and total energy consumption, is the main research subject in this paper. It focuses on a regional measurement and comparison of these undesirable outputs of Chinese firm activities, such as industrial SO2 and CO2 emissions. By applying a data envelopment analysis-slack-based measure (DEA-SBM) model with undesirable outputs indicators, the regional innovation efficiency was evaluated for 30 provinces in China, from 2002 to 2014. The results indicate that the sustainable innovation efficiency of overall China is still relatively low, and varies significantly in different regions. Central and Western China have similar sustainable innovation efficiencies, which are much lower than the sustainable innovation efficiency in Eastern China. Furthermore, the data indicate that regional sustainable innovation efficiency disparities among these three areas are decreasing. Based on these findings, reasons for the sustainable innovation efficiency gap among the different regions were analyzed. To scholars, this paper extends the research on regional sustainable innovation efficiency by implementing an undesirable output perspective to the DEA-SBM model. The findings also provide Chinese policy makers with useful decision support insights for regional sustainable innovation, and energy conservation and emission reduction policies.