Eco-efficiency measurement as an approach to improve the sustainable development of municipalities: A case study in the Midwest of Brazil

Abstract

Global challenges related to energy consumption, water scarcity, deforestation, and environmental pollution have a direct impact on municipalities in Brazil and other countries around the world. Thus, the present study aims to evaluate eco-efficiency and its determinants in 41 Brazilian municipalities between 2014 and 2016 in the area covered by the Araguaia River Valley, in the Midwest of Brazil, Goiás state region. The Araguaia River Valley is considered of economic and especially environmental importance. It is located in one of the main Brazilian river basins, adjacent to states comprising the Legal Amazon, one of the world's most important biomes. To measure the eco-efficiency rate, we applied Data Envelopment Analysis (DEA) via the model of output-oriented variable returns to scale (VRS). Variables used as input include Energy Consumption, Water Consumption, Number of Inhabitants, Fleet of Vehicles, Territorial Area, Deforested Area, and output is the ratio between GDP per capita and Deforested Area. In the second stage, we used Tobit regression with eco-efficiency rate as the dependent variable. For the analyzed period, results show low mean eco-efficiency in the VRS model, with values of 0.45 (2014) and 0.48 (2016). Results indicate that the municipalities of Castelândia in 2014, and Santo Antônio da Barra in 2016, achieved a sustainable balance between environmental and economic variables, contributing to conservation. That suggests that these municipal areas be a benchmark for the others and to local and national public managers, as well as the effective DEA technology applicability in calculating eco-efficiency. In contrast to these two cases, the Mineiros municipality (Araguaia River headwater area) obtained a very low eco-efficiency score. This is extremely concerning since this is an important and sensitive area in this region. In the second stage of the research, the Tobit model indicates that Deforested Area in 2014 and 2016 was significant and negatively correlated with the dependent variable, while Water Consumption (2016) was positively correlated with eco-efficiency. However, the robustness test shows the significant and negative correlation between Water Consumption and eco-efficiency in both years, additionally, the test confirms the results for the Deforested Area variable. These results are important to support policymakers and public managers in the development of more sustainable and eco-efficient municipalities worldwide.