Effect of Merger on Efficiencies: A Study of Taiwanese Higher Education
This study applies nonparametric data envelopment analysis (DEA) to investigate two cases of educational university mergers. The purpose of this study is by comparing the performance differences between pre-merger and post-merger universities to provide a reference for policy makers and management to solve the higher education crisis in Taiwan. This study finds that it seems, so far, no significantly merger synergies reflecting in efficiencies improvement are found from the two cases of post-merger in Taiwan. National Pingtung University (NPTU) is still technical efficiency university after merger. Their efficiency scores are always 1.0 from 2012 to 2017, except 2014. Though, National Tsing Hua University (NTHU) suffers from decay of efficiency scores after merger; their technical efficiency, pure technical efficiency and scale efficiency all dropped after merger.
[1] Cai, Y., and Yang, X. (2016). Mergers in Chinese higher education:
lessons for studies in a global context. European Journal of Higher
Education 6 (1), 71–85.
[2] Zhang, L.-C., and Worthington, A. C. (2018). Explaining estimated
economies of scale and scope in higher education: a meta-regression
analysis, Research in Higher Education 59, 156–173.
[3] Papadimitriou, M. and Johnes, J. (2019). Does merging improve
efficiency? A study of English universities. Studies in Higher Education,
44 (8), 1454–1474.
[4] Zinkovsky, K. V. and Derkachev, P. V. (2018). Restructuring the System
of Higher Education Assessing the Outcomes of University Mergers.
Russian education & society, 60 (5), 402–421.
[5] Russell, Lauren (2019) Better outcomes without increased costs? Effects
of Georgia’s University System consolidations. Economics of Education
Review, 68, 122–135.
[6] De Fraja, G., and Valbonesi, P. (2012). The Design of the University
System. Journal of Public Economics, 96, 317–30.
[7] Johnes, G., and Johnes, J. (2016). Costs, effificiency, and economies of
scale and scope in the English higher education sector. Oxford Review of
Economic Policy, 32 (4), 596–614.
[8] Chen (2020). Efficiency Analyses of Higher Education in Taiwan—
Implications to Higher Education Crisis. Working paper.
[9] Sav, G. T. (2012). Stochastic Cost Frontier and Inefficiency Estimates of
Public and Private Universities: Does Government Matter? International
Advances in Economic Research, 18 (2), 187–98.
[10] Sav, G. T. (2013). Effects of Financial Source Dependency on Public
University Operating Efficiencies: Data Envelopment Single-stage and
Tobit Two-stage Evaluations. Review of Economics and Finance, 3 (1),
63–73.
[11] Wolszczak-Derlacz, J. (2014). An Evaluation and Explanation of
(In)efficiency in Higher Education Institutions in Europe and the U.S.
with the Application of Two-stage Semi-parametric DEA. IRLE Working
Paper No. 114–14.
[12] Schiltza, Fritz and De Witte, Kristof (2017). Estimating scale economies
and the optimal size of school districts: A flexible form approach. British
Educational Research Journal, 43 (6), 1048–1067.
[13] Capuccinello, R. I., and Bradley, S. (2014). The effect of college mergers
on student dropout behaviour: Evidence from the UK. Lancaster
University Management School Working Paper 007.
[14] Fu, T., Huang, C., and Yang, Y. (2011). Quality and economies of scale in
higher education: A semiparametric smooth coefficient estimation.
Contemporary Economic Policy, 29 (1), 138–149.
[15] Cohn, E., Rhine, S., and Santos, M. (1989). Institutions of higher
education as multi-product firms: Economies of scale and scope. The
Review of Economics and Statistics, 71 (2), 284–290.
[16] Johnes, G. (1998). The costs of multi-product organizations and the
heuristic evaluation of industrial structure. Socio-Economic Planning
Sciences, 32 (3), 199–209.
[17] Andrews, M., Duncombe, W., and Yinger, J. (2002). Revisiting
economies of size in American education: Are we any closer to a
consensus?. Economics of Education Review, 21 (3), 245–262.
[18] Farrell, M. J. (1957). The Measurement of Productive Efficiency. Journal
of the Royal Statistical Society, 125, 252–267.
[19] Charnes, A., Cooper, W. W., and Rhodes, E. (1978). Short
Communication: Measuring the Efficiency of Decision Making Units.
European Journal of Operational Research, 2, 429–444.
[20] Banker, R. D., Charnes, A., and Cooper, W. W. (1984). Some Models for
Estimating Technical and Scale Inefficiencies in Data Envelopment
Analysis. Management Science, 30, 1078–1092.
[21] Chavas, J., Barham, B., Foltz, J., and Kim, K. (2012). Analysis and
decomposition of scope economies: R&D at US research universities.
Applied Economics, 44(10–12), 1387–1404.
[22] Ministry of Education of Taiwan official web.
http://depart.moe.edu.tw/ED2300/News_Content.aspx?n=5D06F8190A6
5710E&sms=0DB78B5F69DB38E4&s=495C1DB78B6E7C7A
[23] National Pingtung University official web.
https://eng.nptu.edu.tw/files/15-1150-60349,c5437-1.php?Lang=en
[24] National Tsing Hua University official web.
http://www.nthu.edu.tw/about/nthuIntr
[25] The Laws & Regulations database, Ministry of Justice of Taiwan.
National University Endowment Fund Establishment Act, Article 3.
https://law.moj.gov.tw/ENG/LawClass/LawAll.aspx?pcode=H0030025
[1] Cai, Y., and Yang, X. (2016). Mergers in Chinese higher education:
lessons for studies in a global context. European Journal of Higher
Education 6 (1), 71–85.
[2] Zhang, L.-C., and Worthington, A. C. (2018). Explaining estimated
economies of scale and scope in higher education: a meta-regression
analysis, Research in Higher Education 59, 156–173.
[3] Papadimitriou, M. and Johnes, J. (2019). Does merging improve
efficiency? A study of English universities. Studies in Higher Education,
44 (8), 1454–1474.
[4] Zinkovsky, K. V. and Derkachev, P. V. (2018). Restructuring the System
of Higher Education Assessing the Outcomes of University Mergers.
Russian education & society, 60 (5), 402–421.
[5] Russell, Lauren (2019) Better outcomes without increased costs? Effects
of Georgia’s University System consolidations. Economics of Education
Review, 68, 122–135.
[6] De Fraja, G., and Valbonesi, P. (2012). The Design of the University
System. Journal of Public Economics, 96, 317–30.
[7] Johnes, G., and Johnes, J. (2016). Costs, effificiency, and economies of
scale and scope in the English higher education sector. Oxford Review of
Economic Policy, 32 (4), 596–614.
[8] Chen (2020). Efficiency Analyses of Higher Education in Taiwan—
Implications to Higher Education Crisis. Working paper.
[9] Sav, G. T. (2012). Stochastic Cost Frontier and Inefficiency Estimates of
Public and Private Universities: Does Government Matter? International
Advances in Economic Research, 18 (2), 187–98.
[10] Sav, G. T. (2013). Effects of Financial Source Dependency on Public
University Operating Efficiencies: Data Envelopment Single-stage and
Tobit Two-stage Evaluations. Review of Economics and Finance, 3 (1),
63–73.
[11] Wolszczak-Derlacz, J. (2014). An Evaluation and Explanation of
(In)efficiency in Higher Education Institutions in Europe and the U.S.
with the Application of Two-stage Semi-parametric DEA. IRLE Working
Paper No. 114–14.
[12] Schiltza, Fritz and De Witte, Kristof (2017). Estimating scale economies
and the optimal size of school districts: A flexible form approach. British
Educational Research Journal, 43 (6), 1048–1067.
[13] Capuccinello, R. I., and Bradley, S. (2014). The effect of college mergers
on student dropout behaviour: Evidence from the UK. Lancaster
University Management School Working Paper 007.
[14] Fu, T., Huang, C., and Yang, Y. (2011). Quality and economies of scale in
higher education: A semiparametric smooth coefficient estimation.
Contemporary Economic Policy, 29 (1), 138–149.
[15] Cohn, E., Rhine, S., and Santos, M. (1989). Institutions of higher
education as multi-product firms: Economies of scale and scope. The
Review of Economics and Statistics, 71 (2), 284–290.
[16] Johnes, G. (1998). The costs of multi-product organizations and the
heuristic evaluation of industrial structure. Socio-Economic Planning
Sciences, 32 (3), 199–209.
[17] Andrews, M., Duncombe, W., and Yinger, J. (2002). Revisiting
economies of size in American education: Are we any closer to a
consensus?. Economics of Education Review, 21 (3), 245–262.
[18] Farrell, M. J. (1957). The Measurement of Productive Efficiency. Journal
of the Royal Statistical Society, 125, 252–267.
[19] Charnes, A., Cooper, W. W., and Rhodes, E. (1978). Short
Communication: Measuring the Efficiency of Decision Making Units.
European Journal of Operational Research, 2, 429–444.
[20] Banker, R. D., Charnes, A., and Cooper, W. W. (1984). Some Models for
Estimating Technical and Scale Inefficiencies in Data Envelopment
Analysis. Management Science, 30, 1078–1092.
[21] Chavas, J., Barham, B., Foltz, J., and Kim, K. (2012). Analysis and
decomposition of scope economies: R&D at US research universities.
Applied Economics, 44(10–12), 1387–1404.
[22] Ministry of Education of Taiwan official web.
http://depart.moe.edu.tw/ED2300/News_Content.aspx?n=5D06F8190A6
5710E&sms=0DB78B5F69DB38E4&s=495C1DB78B6E7C7A
[23] National Pingtung University official web.
https://eng.nptu.edu.tw/files/15-1150-60349,c5437-1.php?Lang=en
[24] National Tsing Hua University official web.
http://www.nthu.edu.tw/about/nthuIntr
[25] The Laws & Regulations database, Ministry of Justice of Taiwan.
National University Endowment Fund Establishment Act, Article 3.
https://law.moj.gov.tw/ENG/LawClass/LawAll.aspx?pcode=H0030025
@article{"International Journal of Business, Human and Social Sciences:79668", author = "Chiou Rung Chen", title = "Effect of Merger on Efficiencies: A Study of Taiwanese Higher Education", abstract = "This study applies nonparametric data envelopment analysis (DEA) to investigate two cases of educational university mergers. The purpose of this study is by comparing the performance differences between pre-merger and post-merger universities to provide a reference for policy makers and management to solve the higher education crisis in Taiwan. This study finds that it seems, so far, no significantly merger synergies reflecting in efficiencies improvement are found from the two cases of post-merger in Taiwan. National Pingtung University (NPTU) is still technical efficiency university after merger. Their efficiency scores are always 1.0 from 2012 to 2017, except 2014. Though, National Tsing Hua University (NTHU) suffers from decay of efficiency scores after merger; their technical efficiency, pure technical efficiency and scale efficiency all dropped after merger.", keywords = "data envelopment analysis (DEA), technical efficiency, pure technical efficiency, scale efficiency, merger
", volume = "14", number = "6", pages = "480-6", }
