Evaluating organizational efficiency involves
measuring outcomes, such as revenues, value of goods and services produced,
productivity, etc. However, a sustainable environment requires not only
economic outcomes but also good quality of life in an area. Therefore, this
research proposes a balanced assessment to evaluate environmental efficiency
from the perspectives of urban ecology. We first adopted the bad output data
envelopment analysis to evaluate the efficiency of a metropolitan area followed
by a biotope area factor to assess the
ecological effectiveness of an area. Next, a censored regression model
evaluates the relationship between environmental efficiency and biotope area
factor. The empirical studies were conducted in Taichung, Taiwan. Empirical
results suggest that typical efficiency evaluation of a metropolitan area is
significantly overrated because it excludes external diseconomies such as CO2 emissions which have a profound impact on the environment. The regression
results indicate that environmental efficiency and Taiwan biotope area factor are complementary and can be improved
simultaneously while CO2 emission reduction is at present. We
also show that current utilization of area for non-agriculture and human
activities poses a negative impact on Taiwan biotope area factor.
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