Relative efficiency of plantation companies in Malaysia: a financial ratio-based data envelopment analysis approach

Abdul Wahab, Abdul Hamid and Abdul Razak, Dzuljastri (2015) Relative efficiency of plantation companies in Malaysia: a financial ratio-based data envelopment analysis approach. South East Asia Journal of Contemporary Business, Economics and Law, 6 (1). pp. 25-33. ISSN 2289-1560

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Abstract

This study examines the relative efficiency of 31 plantation companies in Malaysia based on data for the first three cumulated quarters of 2012 (January - September). The study applies an adopted version of Data Envelopment Analysis (DEA). DEA is a tool used to weigh the inputs/outputs and measure the relative efficiency of decision-making units. This research adopts an output-oriented form of DEA based on financial ratios without the utilization of inputs. The innovative adopted DEA model provides a comprehensive decision on a company’s efficiency by taking into account various financial ratios all together and combining them into a single measure of efficiency. The results show that out of the 31 plantation companies in Malaysia, only five (16.13%) proved to be efficient. Also, it is found that the higher a company’s financial ratio in relation to the equivalent ratios of other companies, the higher the efficiency score of that company. Keywords: Efficiency, Data Envelopment Analysis, Malaysia, Plantation Companies

Item Type:	Article (Journal)
Additional Information:	4433/43061
Uncontrolled Keywords:	Efficiency, Data Envelopment Analysis, Malaysia, Plantation Companies
Subjects:	H Social Sciences > HG Finance
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Kulliyyah of Economics and Management Sciences > Department of Finance
Depositing User:	Dr Dzuljastri Abdul Razak
Date Deposited:	26 May 2015 11:11
Last Modified:	17 Nov 2017 14:34
URI:	http://irep.iium.edu.my/id/eprint/43061

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