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Metatechnology frontier and convexity: A restatement

Kristiaan Kerstens (), O’Donnell, Christopher and Ignace Van de Woestyne
Authors registered in the RePEc Author Service: Christopher O'Donnell

European Journal of Operational Research, 2019, vol. 275, issue 2, 780-792

Abstract: This article reconsiders the way metafrontiers and associated measures of efficiency are obtained from nonparametric estimates of underlying group-specific frontiers. Both convex and non-convex metasets have been applied, but the large majority of articles applying this popular methodology assume that the metafrontier envelops a convex metaset. We argue that associated estimates of efficiency are potentially unreliable. We develop a refined methodology for nonparametric envelopment of non-convex metasets. We apply our methodology to a secondary data set to illustrate the potential errors associated with the currently established methods. Anticipating our main conclusion, we find that the convexification strategy consisting in assuming a convex metaset generally leads to erroneous results.

Keywords: Data envelopment analysis; Free disposal hull; Metafrontier (search for similar items in EconPapers)
Date: 2019
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Working Paper: Metatechnology frontier and convexity: A restatement (2019)
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Handle: RePEc:eee:ejores:v:275:y:2019:i:2:p:780-792