A semi-oriented radial measure for measuring the efficiency of decision making units with negative data, using DEA

Ali Emrouznejad, Abdel Latef Anouze and Emmanuel Thanassoulis

European Journal of Operational Research, 2010, vol. 200, issue 1, 297-304

Abstract: Data Envelopment Analysis (DEA) is a nonparametric method for measuring the efficiency of a set of decision making units such as firms or public sector agencies, first introduced into the operational research and management science literature by Charnes, Cooper, and Rhodes (CCR) [Charnes, A., Cooper, W.W., Rhodes, E., 1978. Measuring the efficiency of decision making units. European Journal of Operational Research 2, 429-444]. The original DEA models were applicable only to technologies characterized by positive inputs/outputs. In subsequent literature there have been various approaches to enable DEA to deal with negative data. In this paper, we propose a semi-oriented radial measure, which permits the presence of variables which can take both negative and positive values. The model is applied to data on a notional effluent processing system to compare the results with those yielded by two alternative methods for dealing with negative data in DEA: The modified slacks-based model suggested by Sharp et al. [Sharp, J.A., Liu, W.B., Meng, W., 2006. A modified slacks-based measure model for data envelopment analysis with 'natural' negative outputs and inputs. Journal of Operational Research Society 57 (11) 1-6] and the range directional model developed by Portela et al. [Portela, M.C.A.S., Thanassoulis, E., Simpson, G., 2004. A directional distance approach to deal with negative data in DEA: An application to bank branches. Journal of Operational Research Society 55 (10) 1111-1121]. A further example explores the advantages of using the new model.

Keywords: Data; Envelopment; Analysis; Negative; data; in; DEA; Translation-invariant; DEA; Slack-based; model; Range; directional; measure; Semi-oriented; radial; measure (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (60)

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