Data Envelopment Analysis (DEA) for Measuring the Efficiency of the Hotel Industry in Ecuador

Abstract

[Abstract]: The level of contribution of the hotel industry depends on different factors of production that they use in the provision of their services The way they use these factors of production will allow them to act efficiently, in order to improve profitability and market position. Ecuador, in recent years, has directed public policies betting on the development of this industry. In this sense, this research seeks to measure the efficiency and productivity of the Ecuadorian hotel industry. For this purpose, a significant sample has been selected; it consists of 147 businesses that provided hotel services during the period 2013–2017. These businesses are classified according to their quality and geographic location. This information has been useful to make a balanced panel data with one output (Revenue) and three inputs (Total_personnel, the non-current assets, and Consumption) by using the Data Envelopment Analysis (DEA). The results, which proved to be solid and accurate, indicate that the most efficient businesses are the ones in the third class, whereas those hotels located in zones with tourist attractions and activities have a better optimization of those resources. This situation has an effect on the significant improvement of their productivity.