Energy, environmental, and economic efficiency in fossil fuel exporting countries: A modified data envelopment analysis approach

Abstract

Abstract Due to increasing concerns about high energy consumption and global warming, the energy and environmental efficiency have gained considerable attention of researchers and policymakers. The purpose of this study is to examine the energy, environmental, and economic (E3) efficiency in fossil fuel exporting countries during 2015-2017, using traditional Data Envelopment Analysis (DEA) and a bargaining game cross-efficiency DEA approach. Based on the results, the average energy, economic and environmental efficiencies are equal to 0.77, 0.8, and 0.26, respectively. The results of DEA approach show that the efficiency performances are different in each country, and it is not possible to accurately determine the equilibrium points considering all three measures. Therefore, the efficiency performance of E3 is examined by an integrated model of bargaining game cross-efficiency DEA. Obtaining the product of Nash bargaining payoffs, the countries are ranked in terms of efficiency performance. Countries including China, Oman, Bahrain, Romania and Poland have the top five rankings, respectively. Countries with lowest five rankings include Gabon, Saudi Arabia, Albania, Algeria and Georgia, respectively. Comparing the results of the DEA approach and Nash bargaining game-DEA model shows that the second model is more suitable for ranking due to the unique solution.