Environmental Efficiency Evaluation in Vietnam Textile and Garment Industry: Super-SBM Model with Undesirable Output Approach

Abstract

The purpose of the paper is to estimate the environmental efficiency of the Vietnamese textile and garment industry and evaluate the impact of the factors on environmental efficiency. The study uses firm-level panel data from the Vietnam annual enterprise survey data for the 2012–2018 period in the Vietnam textile and garment industry to evaluate the environmental efficiency by using the Super-SBM DEA model with undesirable output and applies the Tobit regression model to measure the impact of the factors on the environmental efficiency. This study evaluates environmental efficiency and assesses the impact of some core factors, including the origin of imported machinery and equipment, the origin of imported materials, the management of industrial zones, and the presence of FDI firms, on environmental efficiency at the firm level. The results indicate that the average score for environmental efficiency is 0.233. Some factors, such as income per employee, machined goods imported from developed countries, industrial zones, firm improvement processes, and the presence of FDI, have a positive impact on a firm’s environmental efficiency, whereas materials made in Vietnam have a negative impact.