The efficiency of the top Mega yacht builders across the world: a financial ratio-based data envelopment analysis

Alessandro Merendino, Enrico Deidda Gagliardo, Stefano Coronella

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Abstract

This research provides an application of a non-parametric analytic technique (Data Envelopment Analysis, DEA) in measuring the performance of the mega yacht sector. It analyses the efficiency of the top mega yacht companies across the world in 2005-2013 by offering a model useful for comparing inefficient shipbuilders with the efficient ones. This paper adopts an output-oriented version of DEA based on financial ratios where inputs are not utilised. In order to handle missing data, we test and compare two different techniques: the deletion one and the multiple linear regression analysis (MLRA). We find that DEA can be a complement or alternative tool to ratio analysis to evaluate corporates’ performance. We also find that the most efficient shipbuilders are those based in the most prosperous countries. Finally, the MLRA efficiency scores are more reliable and consistent with the firms’ annual reports and financial ratios.
Original languageEnglish
Pages (from-to)125-147
Number of pages23
JournalInternational Journal of Management and Decision Making
Volume17
Issue number2
Early online date13 Jun 2018
DOIs
Publication statusPublished - 2018

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Keywords

  • Data Envelopment Analysis
  • Efficiency
  • Financial Ratios
  • Mega Yacht Sector

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