Radial Approach for Malmquist Productivity Index Measurement on Logistics Industry in Shandong Province

Abstract

Data Envelopment Analysis (DEA), as a non-parametric linear programming technique, is a very useful tool to evaluate the efficiency of Decision Making Units (DMUs) where multiple inputs and outputs are involved. In this paper, the Malmquist Productivity Index (MPI) based on the radial DEA is used to measure the productivity changes of Shandong provincial logistics industry from 2012 to 2014. The analysis of the results indicates that there are large gaps in productivity development level among 17 cities in Shandong provincial logistics industry. Moreover, as a whole, the results also shows that the MPI of the Shandong provincial logistics industry experienced a continuous regress from 2012 to 2014. The empirical results analyses can provide decision makers of government and industry organizations significant suggestions in improving the productivity of the logistics industry and promoting the sustainable development of the logistics industry among different cities in Shandong province.