 Efficiency decomposition of the network DEA in variable returns to scale: An additive dissection in lossesHsuan-Shih Lee Omega, 2021, vol. 100, issue C Abstract: Kao and Hwang [10] proposed a model based on the multiplier form for two-stage network under constant returns to scale. Their model assumes that the system efficiency is the product of the efficiencies of the two stages. That is, the system operates in a multiplicative way. Alternatively, we define loss to be equal to the aggregated input (cost) minus the aggregated output (revenue). Based on the notion of the loss, we dissect a system in a way that the system loss is the sum of the losses of the subsystems. That is, a system operates in an additive way. We find that the model in [10] can be decomposed in this additive way. We further develop the multiplier form under VRS for the two-stage network based on losses, whose dual form is the VRS extension of the CRS envelopment model in [10]. Based on losses, an alternative definition of efficiency other than ratio efficiency is provided. Based on the additivity of losses, the two-stage VRS model is further extended to a general network structure. Keywords: Data envelopment analysis (DEA); Multiplier form; Two-stage network DEA; Variable returns to scale (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jomega:v:100:y:2021:i:c:s030504831930698x Ordering information: This journal article can be ordered from DOI: 10.1016/j.omega.2020.102212 Access Statistics for this article Omega is currently edited by B. Lev More articles in Omega from Elsevier |
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