EFFICIENCY EVALUATION OF INDIAN HIGHER EDUCATIONAL INSTITUTIONS USING GOVERNANCE AS ENVIRONMENTAL VARIABLE - A DEA APPROACH

Higher Education Institutions (HEIs) play a pivotal role in building human capital and fostering innovation. This is especially true within India’s rapidly evolving academic ecosystem. This study evaluates 76 Indian HEIs ranked in the NIRF Top Hundred from 2020 to 2024. It introduces governance type - Centrally Funded Institutions (CFIs), State Funded Institutions (SFIs), and Privately Managed Institutions (PMIs) - as a non-discretionary variable in Data Envelopment Analysis (DEA). The Extended BCC (EBCC) model constructs governance-specific frontiers, and the resulting Extended Pure Technical Efficiency (EPTE) scores capture the influence of variations in autonomy, funding structures, and regulatory oversight. Comparative analysis with conventional PTE scores indicates an 18% increase in the number of efficient institutions under the EBCC framework, highlighting the significance of accounting for governance heterogeneity in efficiency assessment. PMIs show the largest gains, resulting in a twenty-seven percent improvement in efficiency classification. Paired t-tests confirm the statistical significance of these differences. Consistency analysis shows CFIs as stable, PMIs improving with greater consistency, and SFIs are highly efficient with minor variations. Ranking analysis shows that twelve institutions consistently achieved perfect efficiency across CCR, BCC, and EBCC models. By correcting systemic bias and revealing hidden institutional capacities, the EBCC framework offers equitable benchmarks for policymakers, regulators, and accreditation bodies. Incorporating governance as a non-discretionary variable addresses a critical gap in DEA literature. This approach supports context-sensitive reforms and fosters balanced, resilient development of higher education in India.