Comparative Study of Energy and Environmental Efficiency in Developing Countries: Desirable and Undesirable Output Approach

This paper introduces a new approach to evaluating selected developing countries. In this study, we define two categories of outputs (desirable and undesirable) to measure the performance of the selected countries. Indeed, it is necessary to explore how to combine two separated efficiency measures in a unified structure. The conventional data envelopment analysis (DEA) may fail to identify decision-making units (DMUs) and as a result efficiency scores may not be meaningful, especially when the number of DMUs is insufficient. In this paper, a new approach is presented based on DEA and game theory to evaluate large-scale DMUs. For this purpose, the bargaining games as a cooperative game model are combined with the conventional DEA models. Moreover, DMUs do be are divided by different categories of measures in the competitive environment. The results show that China and Poland have conditions of maximum energy efficiency with using the integrated assessment model. Other countries have been qualified by a bargaining game, but they have not been a favorable outcome like as China and Poland.