Journal
EUROPEAN JOURNAL OF OPERATIONAL RESEARCH
Volume 227, Issue 1, Pages 182-189Publisher
ELSEVIER
DOI: 10.1016/j.ejor.2012.12.009
Keywords
Regional environmental efficiency; Directional distance function; Conditional measures; UK regions
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This paper, by using conditional directional distance functions as introduced by Simar and Vanhems [J. Econometrics 166 (2012) 342-354] modifies the model by Fare and Grosskopf [Eur. J. Operat. Res. 157 (2004) 242-245] and examines the link between regional environmental efficiency and economic growth. The proposed model using conditional directional distance functions incorporates the effect of regional economic growth on regions' environmental efficiency levels. The results from UK regional data reveal a negative relationship between regions' GDP per capita and environmental inefficiency up to a certain GDP per capita level. After that level it appears that the relationship becomes positive. As an overall result the regional environmental inefficiency-GDP per capita relationship appears to have a 'U' shape form. (C) 2012 Elsevier B.V. All rights reserved.
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