Assessing eco-technological innovation efficiency using DEA approach: insights from the OECD countries

Enormous amount of energy consumption and greenhouse gas emissions are causes of several severe environmental issues faced by all countries around the globe. OECD countries are focusing on reducing their energy consumption and CO 2 emissions along with improvement in their eco-technological innovations. These efforts require measuring energy efficiency, CO 2 emissions efficiency, and eco-technological innovation efficiency. This study aims at providing a way of measuring the aforementioned efficiencies for OECD countries using the data envelopment analysis approach which is one of the most widely used approaches for measuring relative efficiencies of various decision-making units (OECD countries). The study uses slack-based measure of data envelopment analysis with modification to treat undesirable outputs. Data for the total labor force, conventional energy consumption (as defined in this study), and renewable energy consumption are used to constitute inputs for the model, while GDP, patents, designs, and trademarks data are taken as desirable outputs. The study also includes CO 2 emissions as the only undesirable output considered for this study. The results are tantalizing as the findings indicate a huge room for improvement in most of the countries’ efficiency scores. By improving their eco-technological innovation efficiency and reducing energy consumption and CO 2 emissions, they can contribute to the solution of environmental problems. Fine-tuning policies for patents, trademarks, and design registration to encourage progress in technological innovations, as well as change in energy mix policies can lead to change in environmental outcomes of economic development. Graphical abstract