Profit inefficiency of Japanese securities firm

We develop a new indicator of profit inefficiency, which is based on decision-makers choosing the amount to spend on each input and the amount to earn on each output, rather than choosing physical quantities of inputs and outputs. The method is suitable for situations when prices and quantities are not directly observable, when markets are non-competitive, or when qualitative differences exist for inputs and outputs between firms. The indicator of profit inefficiency equals normalized lost profits arising from technical inefficiency and allocative inefficiency. We offer an empirical example of our method using firms in the Japanese securities industry during the period 1989-2005. We find profit inefficiency rises from 1989 to 1993, declines during the 1994-2001 period, and then increases during the years 2002-2005. Allocative inefficiency tends to be a greater source of profit inefficiency than technical inefficiency. Lost profits as a percent of assets range from 0% to 15% and are highest in 2002-2005.

Dynamic Network DEA and An application to Japanese Prefectures

Workshop 2013 on Dynamic and Network DEA (January 29-30, 2013)The purpose of this paper is twofold. First, we develop a multi-period dynamic multi-process network DEA (data envelopment analysis) model. Second, we apply this methodology to Japanese prefectural time series data. In this framework, we specify that prefectural technology consists of two sectors, called the human capital generating sector and the physical capital formation sector. Each sector has its own exogenous inputs, and carry-overs in preceding and subsequent periods as well as final output. We assume that the final output is jointly produced by the two sectors.This workshop is supported by JSPS KAKENHI Grant Number 22310093 under the title “Theory and Applications of Dynamic DEA with Network Structure.

A dynamic-network slacks-based measure with an application to Japanese Prefectures

Workshop 2015 -Advances in DEA Theory and Applications (December 1-2, 2015)This paper develops a dynamic-network DEA (data envelopment analysis) model where total output is jointly produced from two sectors: a human capital sector and a physical capital sector. While human capital is treated as an exogenous input, physical capital production is an intermediate output of one period that becomes an input to a subsequent period. The method is applied using pooled data on 47 Japanese prefectures during the period 2007-2009.The workshop is supported by JSPS (Japan Society for the Promotion of Science), Grant-in-Aid for Scientific Research (B), #25282090, titled “Studies in Theory and Applications of DEA for Forecasting Purpose.本研究はJSPS科研費 基盤研究(B) 25282090の助成を受けたものです

Modelling bank performance: a network DEA approach

In this paper, we develop a bank network revenue function to evaluate banks’ network revenue performance. The bank network revenue function, which extends the environmental revenue function and the two-stage network cost function, is constructed as the difference between total revenue and the reserves for possible loan losses to incorporate the roles played by non-performing loans in bank production. The second part of the paper then applies Nerlove's revenue inefficiency model. We consider revenue maximization in two stages. We apply this function to Japanese banks operating from September 2000 to March 2013

Chance-constrained cost efficiency in data envelopment analysis model with random inputs and outputs

Data envelopment analysis (DEA) is a well-known non-parametric technique primarily used to estimate radial efficiency under a set of mild assumptions regarding the production possibility set and the production function. The technical efficiency measure can be complemented with a consistent radial metrics for cost, revenue and profit efficiency in DEA, but only for the setting with known input and output prices. In many real applications of performance measurement, such as the evaluation of utilities, banks and supply chain operations, the input and/or output data are often stochastic and linked to exogenous random variables. It is known from standard results in stochastic programming that rankings of stochastic functions are biased if expected values are used for key parameters. In this paper, we propose economic efficiency measures for stochastic data with known input and output prices. We transform the stochastic economic efficiency models into a deterministic equivalent non-linear form that can be simplified to a deterministic programming with quadratic constraints. An application for a cost minimizing planning problem of a state government in the US is presented to illustrate the applicability of the proposed framework

Efficiency and ownership: Evidence from Japanese credit cooperatives.

Data envelopment analysis (DEA) is used to estimate the overall efficiency and productivity growth of credit cooperatives in Japan during 1992-1996. Overall efficiency is decomposed into output technical efficiency and input allocative efficiency. Twenty percent of all credit cooperatives in Japan are foreign owned with more than 90% of those owned by Koreans. The history of institutional discrimination against Koreans in Japan suggests that ownership might affect efficiency. The empirical findings suggest that foreign-owned cooperatives are more efficient and experienced greater productivity growth during the period

Decomposing profit efficiency using a slack-based directional distance function

This paper develops a slack-based decomposition of profit efficiency based on a directional distance function. It is an alternative to Cooper, Pastor, Aparicio, and Borras (2011)

Incidence of endophthalmitis after intravitreal injection of an anti-VEGF agent with or without topical antibiotics

Intravitreal injection (IVI) of anti-vascular endothelial growth factor (VEGF) is the standard treatment modality in various types of retinal diseases. However, endophthalmitis remains the most serious complication. Despite the lack of evidence that antibiotics prevent endophthalmitis, topical antibiotics are still used routinely in Japan. We conducted a retrospective multicenter study by analyzing records from patients who underwent IVI of anti-VEGF agents with or without antibiotic treatment. In the analysis of a total of 147,440 eyes, the incidence of endophthalmitis was 0.007%: 0.005% with no use of antibiotics, 0.009% with antibiotic pretreatment, 0.012% with posttreatment, and 0.005% with pre- and posttreatment. There was no statistically significant difference among the four groups (chi-square test, p = 0.57). Most facilities used masks, sterilized gloves, and drapes. Nine of the 10 eyes that developed endophthalmitis received topical antibiotics, and all infected eyes underwent IVI with aflibercept, not the prefilled syringe delivery system. In four patients who received multiple IVI, the detection of causative bacteria revealed resistance to used antibiotics. Data from this large population, treated with or without antibiotics, suggests that antibiotic prophylaxis does not reduce the rate of endophthalmitis after IVI