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Heterogeneity and the evaluation of efficiency: the case of Italian universities

Research output: Contribution to journalJournal article

Published

Journal publication date2010
JournalApplied Economics
Journal number11
Volume42
Number of pages11
Pages1365-1375
Original languageEnglish

Abstract

A random parameters stochastic frontier model is applied to Italian data in order to evaluate the cost function and efficiency of higher education institutions. The method yields useful information about inter-institutional variation in cost structure and technical efficiency. Returns to scale and scope are evaluated for the typical university, and it is found that these returns are almost ubiquitously decreasing, a finding with clear policy implications.