The relative efficiency of education and health spending is assessed by comparing expenditure levels and associated outcomes in G7 countries and other OECD countries. This is done using the Data Envelopment Analysis (DEA) technique, which was developed for estimating best-practice frontiers and relative efficiency in business applications. In this case, DEA is used to assess the relationship between spending (inputs) and outcomes (production) across countries. The general principle is that countries which achieve the same or better outcomes with lower levels of spending than other countries in the sample are the most efficient and determine the best-practice frontier. .
