The Operational Efficiency Measurement of China’s Top 100 Digital Economy Firms: An Approach Based on DEA and Kernel Density Estimation

Abstract

In recent years, China’s digital economy has become a key engine for high-quality development. Assessing the operational efficiency of leading digital enterprises is crucial for optimizing resource allocation and promoting sectoral growth. However, existing research largely remains at regional or industry levels and typically reports efficiency scores without diagnosing the root sources of inefficiency. To fill this gap, this study measures the operational efficiency of 99 firms selected from China’s Top 100 Digital Economy list (2017–2022) using the BCC-DEA model, and analyzes their dynamic evolution via kernel density estimation. The findings reveal a fluctuating upward trend in overall efficiency, and that the gap in overall technical efficiency primarily originates from scale efficiency rather than pure technical efficiency. The kernel density peak exhibits a “rise–decline–rise” pattern, indicating existing but narrowing efficiency differences among firms. By decomposing efficiency, this study further classifies firms into four types, revealing that inefficiency is heterogeneous. This paper makes three main contributions. First, it identifies scale efficiency as the main source of efficiency gaps. Second, it classifies firms into four types, revealing that inefficiency is heterogeneous. Third, it uses kernel density estimation to track the dynamic evolution of efficiency, showing a narrowing efficiency gap but a persistent superstar effect. Two policy implications follow: firms with low pure technical efficiency should focus on management training and technology adoption, while firms with low scale efficiency should pursue scale expansion through mergers or partnerships.