Efficiency and Performance of Sustainable Development of the Western Balkan Countries: Whether Membership in the European Union is Recipe for Sustainability?

Abstract

To evaluate the impact of economic growth over time, the concept of sustainable development stresses the need to balance the three pillars of sustainability: economic, social, and environmental factors. This study compares the countries of the Western Balkans with former socialist countries now in the EU by analyzing their efficiency and overall performance in terms of sustainable development. The analysis focuses on data from 2019, just before the onset of the COVID-19 pandemic. The study utilized Data Envelopment Analysis (DEA) with a Slacks-Based Measure (SBM) model. The input variables in this model included carbon dioxide (CO2) emissions, the unemployment rate, and energy consumption, while the output variables were Gross Domestic Product (GDP) and life expectancy at birth. The main finding of the study was the identification of the average efficiency scores, showing that EU member states typically had the highest scores and demonstrated the best practices, with Bulgaria and, to a lesser extent, Slovakia as notable exceptions, along with Albania. In contrast, most of the other countries in the Western Balkans were found to be inefficient in their sustainable development policies. Additionally, developing countries, on average, performed the worst across the variables analyzed. For a more detailed assessment of efficiency, the study also calculated the harmonized efficiency of the observed countries. This was done by dividing individual efficiency results by the average efficiency within the Western Balkan countries group and the EU member states group. Composite efficiency was also considered, which represents the weighted sum of DEA efficiency and inverse DEA efficiency. To determine the sustainable development performance of the countries, the simple additive weighting (SAW) method was used, applying the weighting coefficients derived from the CRITIC method. The results of this analysis were consistent with those obtained from the SBM DEA method. EU member states, except for Bulgaria and Slovakia, generally had the highest index values and were ranked the best in terms of sustainable development performance. On the other hand, the Western Balkan countries ranked significantly lower in comparison.