Efficiency of the knowledge triangle policy in the EU member states: DEA approach

Abstract

This paper aims to compare relative efficiency of the knowledge triangle policy in 25 EU member states providing evidence on the knowledge triangle technical efficiency calculated relying on output-oriented Data Envelopment Analysis (DEA) model assuming variable returns to scale (VRS). Moreover, the knowledge triangle efficiency indices are calculated, utilising the concept of actual and target inputs. Results obtained under output-oriented VRS model may signify overall effectiveness of the EU knowledge triangle policy. A more detailed analysis of output-oriented knowledge triangle efficiency indices reveals more differentiation among some countries. There are also significant variations among efficient decision-making units (DMUs) revealed through reference share analysis. Outcomes of this research may suggest the need of modification and/or strengthening of the knowledge triangle policy in some EU member states. The results obtained should however be treated with caution because they are influenced by the choice of variables.