Scoring method of eco-efficiency using the DEA approach: evidence from European waste sectors

The increase in human-induced greenhouse gas (GHG) emissions released into the atmosphere is one of the biggest concerns around the globe. The waste sector contributes significantly to this verified increase in emissions, not only because of the quantity of waste generated, but also because of waste treatment, a highly polluting process. To deal with these issues, several directives are being implemented at a European level. In order to confirm if these policies to reduce GHG emissions associated with waste disposal are efficient, this paper aims to assess the environmental efficiencies that result from waste generation. The data used in this study encompass a set of 15 European countries for the period between 2001 and 2015. Eco-efficiency is measured by using the ratio of GDP per capita and GHG emissions per capita derived from the waste sector, and is assessed by the application of the data envelopment analysis approach. Additionally, we also evaluate the state of decoupling between the waste sector emissions (GHG emissions) and economic growth. This analysis intends to understand which economic drivers produce decoupling effects, and to assess to what extent additional factors are influencing this core relationship. Globally, the results show that Luxembourg, the United Kingdom, the Netherlands, Belgium and Sweden present better economic and environmental performance when compared to the other countries. Luxembourg is beyond doubt the most efficient country, presenting the highest scores in most of the years between 2001 and 2015. On the other hand, countries like France, Portugal and Austria report the worst performance, presenting eco-efficiency scores below 20%, for the whole period under analysis. In addition, the results of the decoupling elasticity analysis suggest that the optimal decoupling state occurs when there is a drastic and significant reduction in the mean variations of the GHG emissions in the waste sector and a low variation in the average economic growth rate. Our results reinforce the existence of a discrepancy in waste management within the different member states. The countries, which include in their waste management a wider variety of waste treatments, are more efficient than the ones that are still using landfilling as the principal form of waste disposal. Recycling rates play a crucial role for the countries to move up in the "Waste hierarchy", as well as the implementation of the EU directives relating to waste management. Taking all this in consideration, policy makers must reinforce these directives not only at a national, but also at regional level.