A non-radial measure of different systems for Taiwanese tourist hotels’ efficiency assessment

Abstract

The literature assumes that Taiwan’s international tourist hotels have identical frontier technology to evaluate non-radial efficiencies, even if they characterize different operating types. This study develops a non-radial systems model, for which the different operating types are evaluated based on different frontier technologies in order to calculate efficiencies. Compared to the radial systems model, the new model is able to practice two verifications. First, efficient units can be separated into strong and weak efficient sets. The second finds the benchmark among the different types for each input and output. The empirical results show that most efficient units reflect strong efficiency while only one hotel reflects weak efficiency. Inefficient hotels should refer to the chain type in order to improve excess utilizations in employees, rooms, catering space, and revenue deficits. For improving excess operating expenses and occupancy rate deficits, inefficient hotels should refer to the independent type.