Using super-efficiency DEA to benchmark the Internet channels efficiency

Abstract

The emergence of the Internet has forced a wealth of firms to explore a new form of channels of distribution, i.e., Internet channels. Nevertheless, few empirical studies undertake comprehensive Internet channels evaluation and provide direct evidence on their performance implications. In order to fill in the literature gap, this research employs super-efficiency data envelopment analysis (DEA) to benchmark the operating efficiency of Internet channels. Empirical data are collected from the financial service sector in Taiwan. The findings demonstrate that the existence of large inefficiencies due to poor input utilization and failure to operate at constant returns to scale. This research provides significant insight into the degree of the efficient firms, further identifies the most distinguished firm as benchmark, and eventually benefits multiple-channel-policy making in resource allocation.