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Spatial heterogeneity in composite indicator: A methodological proposal

Author

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  • Fusco, Elisa
  • Vidoli, Francesco
  • Sahoo, Biresh K.
Abstract
Most of the existing literature on the construction of composite indicator (CI) in the Benefit of the Doubt (BoD) framework fails to consider the exogenous external (tangible or intangible) factors, which might have influences on individual components of the CI. The present research proposes an original method to estimate the CI by considering the external factors directly into the robust BoD model. More specifically, a particular focus has been devoted to the “spatial conditioning” in which much of the underlying observed differences in CI scores may be attributed to a multitude of territorial conditional variables. The proposed method is illustrated using two data sets: one containing simulated data and the other one relative to real data covering the social supply delivered by the Italian municipalities. Results stress the importance of properly taking into account the local non-independence of the units in order to better separate the performances of individual units by the contribution of their territories.

Suggested Citation

  • Fusco, Elisa & Vidoli, Francesco & Sahoo, Biresh K., 2018. "Spatial heterogeneity in composite indicator: A methodological proposal," Omega, Elsevier, vol. 77(C), pages 1-14.
    • Handle: RePEc:eee:jomega:v:77:y:2018:i:c:p:1-14
    DOI: 10.1016/j.omega.2017.04.007
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    13. Kristof De Witte & Laura López-Torres, 2017. "Efficiency in education: a review of literature and a way forward," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 68(4), pages 339-363, April.
    14. Polemis, Michael L. & Tzeremes, Nickolaos G., 2019. "Competitive conditions and sectors’ productive efficiency: A conditional non-parametric frontier analysis," European Journal of Operational Research, Elsevier, vol. 276(3), pages 1104-1118.
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