Integrating spatial relationships in the DEA approach for ecological efficiency evaluation: A case study of the Chaohu watershed

Abstract

This study introduces an innovative Data Envelopment Analysis (DEA) model that integrates spatial relationships among decision-making units (DMUs) to determine relative prices of all variables for evaluating ecological efficiency more accurately, particularly in the context of water resource management. To better capture ecological performance, we propose a model that includes spatial correlation, addressing interdependencies that traditional DEA models often overlook. By incorporating a spatial weight matrix, the model delineates interactions between DMUs, offering a comprehensive evaluation that considers both technical efficiency and the spatial efficiency impact. We demonstrate the utility of our model through an empirical analysis of 17 national monitoring cross-sections within the Chaohu Watershed, a critical ecological and economic zone within China’s Yangtze River Delta. This research contributes to the fields of environmental economics, resource management, and spatial analysis by providing a robust methodological framework and actionable insights for sustainable environmental stewardship.