The efficiency of employment relationship: Through data envelopment analysis

Abstract

Employment relationship (ER) is a social exchange relationship in nature with uncertainty and incongruence during the exchange process. Previous studies has been stuck on regression-based methods, examining and exploring related issue by studying the exchanges of both parties and even more stakeholders, but the nature of the exchange process itself is ignored. This study jumps out of the causality study represented by the regression analysis method, and uses the FCE that reflects the essence of object better and the Data Envelopment Analysis (DEA) to measure the efficiency of the exchange process, which can help enterprises to improve the evaluation of ER. DEA is used to evaluate the technical effectiveness of decision units (DMUs) with the same type of inputs and outputs. The result suggests that the phenomenon of inefficient exchange is still widespread. We make the importance ranking of selected inducement and find that labors in China attach importance to the correctness of management process rather than the additional benefits. For the first time, the quantitative efficiency value replaces the simple description 'uncertainty' in research of the exchange process. Meanwhile, the framework independently measures the input of enterprises and the output of employees which has high adaptability. It can adjust, modify and accurately evaluate the exchange efficiency of two parties according to the actual exchange situation.