Multi-Level Parallel Production Networks

Antonio Peyrache () and Maria Silva
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Antonio Peyrache: School of Economics and Centre for Efficiency and Productivity Analysis (CEPA) at The University of Queensland, Australia

No WP052021, CEPA Working Papers Series from University of Queensland, School of Economics

Abstract: Network Data Envelopment Analysis (DEA) has become a largely researched topic in the DEA literature. In this paper we consider one of the simplest network models: Parallel Network DEA models. We briefly review a large body of literature that relates to these network models. Then we proceed to discuss existing models and point out some of their pitfalls. Finally, we propose an approach that attempts to solve these pitfalls, recognising that when one computes a decision making unit (DMU) efficiency score and want to decompose it into the divisional/process efficiencies there is a component of allocative inefficiency. We develop our models at three levels of aggregation: the sub-unit (production division/process), the DMU (firm) and the industry. For each level we measure the inefficiency using the directional distance function and we relate the different levels to each other by proposing a decomposition into exhaustive and mutually exclusive components. We illustrate the application of our models to the case of Portuguese hospitals and we also propose avenues for future research, since most of the topics addressed in this paper are not only related to Parallel network models but to general network structures.

Keywords: Data Envelopment Analysis; Multi-Level Networks; Parallel Networks; Directional Distance Function; Efficiency. (search for similar items in EconPapers)
Date: 2021-02
New Economics Papers: this item is included in nep-ecm, nep-eff and nep-net
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:qld:uqcepa:159

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