A goal-oriented approach for supporting input/output determination in regulatory benchmarking

Benchmarking, in many cases by means of Data Envelopment Analysis, is one of the main strategies of regulatory agencies to control the costs of monopolistic companies. In such cases, the determination of inputs and outputs as performance criteria is often an issue. Against this background, we propose a goal-oriented approach that allows to make the so-called Generalized Data Envelopment Analysis (GDEA) fruitful for regulatory benchmarking. As example, we apply this approach to the Brazilian electric energy transmission system operators. As policy implications, we provide directions and discussions on how to apply GDEA in regulatory benchmarking.