Investigating economic efficiency in Italy: A regional comparison

This paper provides a comparative analysis of the hospitality sector
using the island of Sardinia and the autonomous province of Bolzano as a case
study. The comparison holds its own interest since they are both tourism
destinations, though characterised by different features as far as seasonality is
concerned. Employing a large sample set, pure technical and scale efficiency
are computed using a panel data envelopment analysis. Overall, the empirical
findings reveal that the hospitality sector in Sardinia and in Bolzano can be
regarded as economically inefficient and mostly depicting decreasing returns to
scale. Nevertheless, some distinctive features are detected amongst firms
classified by size. Policy implications are drawn to help economic agents to
improve their efficiency scores, thus leading to an optimal revenue
management strategy.