A Performance Measure to Support Decision-Making in Agricultural Research Centers in Brazil

Abstract

The assessment of productive efficiency of a public research institution is of fundamental importance for its administration. A better management of available resources may be accomplished if managers have at their disposal meaningful quantitative measurements of the production process. In this paper we use Multivariate Analysis and Data Envelopment Analysis to define a performance measure for the research centers of the Brazilian Agricultural Research Corporation. Multiple production indicators are reduced to three output variables by means of maximum likelihood factor analysis. Performance is determined on the basis of this output vector and a three dimensional input vector defined by cost components. We impose restrictions on the optimization algorithm to guarantee usage of all outputs and inputs in the optimal solutions. Types of research centers are compared by using fractional regression models, quasi-maximum likelihood estimation and bootstrap. The analysis also provides a weighting system to compute a goal achievement index and therefore support managerial decision-making.