Technical efficiency of for‐profit and non‐profit nursing homes

John L. Fizel, Thomas S. Nunnikhoven

Research output: Contribution to journalArticlepeer-review

63 Scopus citations


This paper employs data envelopment analysis to generate efficiency indices for individual nursing homes relative to a best‐practice frontier. Further analysis then shows that these ‘unadjusted’ indices represent factors other than efficiency. Regression analysis purges the indices of these confounding influences. The resulting ‘adjusted’ efficiency indices demonstrate that for‐profit homes have higher mean levels of efficiency and a more efficient production frontier than non‐profit homes. These results support the property rights hypothesis that forprofit homes are inherently more efficient than non‐profit ones.

Original languageEnglish (US)
Pages (from-to)429-439
Number of pages11
JournalManagerial and Decision Economics
Issue number5
StatePublished - 1992

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Strategy and Management
  • Management Science and Operations Research
  • Management of Technology and Innovation


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