The effects of size and information technology on hospital efficiency

This paper investigates the effects of size and information technology (IT) on the efficiency of the production process for 92 public nonprofit hospitals in Thailand. Efficiency is measured by a nonparametric technique, data envelopment analysis (DEA). The effect of size on efficiency is obtained through analyzing the differences in the distribution of the efficiency measures using a nonparametric statistical test, namely, Mann–Whitney test. IT impacts are assessed by the Tobit regression analysis, with the DEA measures and IT as dependent and independent variables, respectively. Results indicate that large hospitals significantly operate more efficiently than small hospitals and IT positively contributes to the efficiency for both large and small hospitals. Policies aiming at improving the efficiency of hospitals should thus focus on size expansion for smaller hospitals as well as on IT adoption.