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Annals of Operations Research

, Volume 173, Issue 1, pp 39–56 | Cite as

A DEA methodology to evaluate the impact of information asymmetry on the efficiency of not-for-profit organizations with an application to higher education in Brazil

  • José Mairton Figueiredo de França
  • João Neiva de FigueiredoEmail author
  • Jair dos Santos Lapa
Article

Abstract

This paper presents a conceptual framework and an analytical DEA model for evaluating the impact of information asymmetry on organizational efficiency. The framework uses concepts from agency theory to estimate the extent of moral hazard by comparing the objectives of the principal to those of the agent. The framework and model are useful in the analysis of both for-profit and not-for-profit organizations because DEA is applicable whether or not inputs and/or outputs are subject to pricing mechanisms. An illustration focusing on the Brazilian not-for-profit federal university system finds that the agency problem indeed exists for a subset of those institutions, indicating the desirability of improved incentive and control mechanisms on the part of the principal.

Keywords

Agency theory Organizational efficiency Information asymmetry Moral hazard Not-for-profit organizations Data envelopment analysis 

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Copyright information

© Springer Science+Business Media, LLC 2009

Authors and Affiliations

  • José Mairton Figueiredo de França
    • 1
  • João Neiva de Figueiredo
    • 2
    Email author
  • Jair dos Santos Lapa
    • 3
  1. 1.Economics DepartmentRio Grande do Norte State University—UERNMossoróBrazil
  2. 2.Department of Management, Haub School of BusinessSaint Joseph’s UniversityPhiladelphiaUSA
  3. 3.Production and Systems Engineering DepartmentFederal University of Santa Catarina—UFSCFlorianópolisBrazil

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