Evaluation of the Regional Financial Efciency Based on SBM-Shannon Entropy model

Abstract

The imbalance of regional development is an important problem in China’s economic development. This paper measures the allocation efficiency of financial resources of 31 provinces in China from 2008 to 2018. This paper makes up for the defciency of the traditional DEA model in variable selection and effciency identification. Firstly, we use AIC, BIC, and HQC information criteria to select variables, and construct a more scientific and reasonable financial effciency evaluation index system. On this basis, the Shannon entropy index is used to improve the discrimination ability. The results show that: (1) The combination of Shannon entropy index makes the result more accurate and improves the discrimination ability. (2) The Eastern region has the highest CES score, followed by the Midland and Western region, and the Northeast region has the lowest CES score. (3) Overall, from 2008 to 2018, the effciency of financial resource allocation in China showed an upward trend.