Efficiency Analysis of Public Health Expenditures: Application of Data Envelopment Analysis and Shannon Entropy Weighting

This study conducts a comprehensive investigation into the efficiency of public health expenditure employing the Shannon Entropy Calculated Efficiency weighting method. The main objective is to provide an in-depth assessment of the effectiveness of resource allocation within the public health sector, particularly in the context of municipalities in Minas Gerais, which face significant challenges in managing public health funds due to financial constraints and social disparities. By integrating Shannon Entropy into the efficiency assessment, this methodology refines the analysis to account for the inherent variability and uncertainty of the data, thus enabling a more nuanced understanding of the distribution of health resources. The results obtained reveal a new appreciation into the allocation of health resources, highlighting specific areas for potential improvement and optimization, which are essential to increase the overall efficiency of public health expenditure. This robust framework serves as a valuable tool for policymakers, facilitating informed decision-making processes and ensuring effective utilization of public health funds. The main contribution of this study lies in the application of Shannon Entropy for efficiency analysis, which not only improves the understanding of public health expenditures, but also provides a new appreciation to optimize resource allocation in the health sector.