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Article

Financial Performance Assessment of Construction Firms by Means of RAM-Based Composite Indicators

School of Applied Mathematics and Physics, National Technical University of Athens, 15780 Athens, Greece
Mathematics 2020, 8(8), 1347; https://doi.org/10.3390/math8081347
Received: 9 June 2020 / Revised: 23 July 2020 / Accepted: 24 July 2020 / Published: 12 August 2020
(This article belongs to the Special Issue Multiple Criteria Decision Making)
This paper aims to provide a novel construct that is based on data envelopment analysis (DEA) range adjusted measure (RAM) of efficiency and demonstrate its practical implementation by evaluating the financial performance of a sample of three upper-class contracting license (Classes 5–7) Greek construction firms. In a two-step framework, firm efficiency (i.e., composite indicators (CIs)) is produced firstly by means of RAM using single financial ratios, which are selected by grey relational analysis (GRA), and then Tobit regression is employed to model the CIs. In light of the results, only 4% of the sampled firms are efficient, and the firm ranking is consistent with the ranking of Grey Relational Grande (GRG) values produced by GRA. Moreover, the firms with a contracting license of the highest level (Class 7) appear not to be superior in efficiency to their counterparts that belong to Classes 5–6. View Full-Text
Keywords: data envelopment analysis; grey relational analysis; composite indicators; construction firms; Tobit regression data envelopment analysis; grey relational analysis; composite indicators; construction firms; Tobit regression
MDPI and ACS Style

Tsolas, I.E. Financial Performance Assessment of Construction Firms by Means of RAM-Based Composite Indicators. Mathematics 2020, 8, 1347. https://doi.org/10.3390/math8081347

AMA Style

Tsolas IE. Financial Performance Assessment of Construction Firms by Means of RAM-Based Composite Indicators. Mathematics. 2020; 8(8):1347. https://doi.org/10.3390/math8081347

Chicago/Turabian Style

Tsolas, Ioannis E. 2020. "Financial Performance Assessment of Construction Firms by Means of RAM-Based Composite Indicators" Mathematics 8, no. 8: 1347. https://doi.org/10.3390/math8081347

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