DEA with non-monotonic variables. Application to EU governments’ macroeconomic efficiency

Gabriel Villa and Sebastián Lozano
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Sebastián Lozano: University of Seville

Journal of the Operational Research Society, 2016, vol. 67, issue 12, 1510-1523

Abstract: Abstract Conventional Data Envelopment Analysis (DEA) considers monotonic variables, ie the lower the inputs and the larger the outputs, the better. There are, however, occasions when the monotonicity of a variable with respect to efficiency depends on the value of the variable, that is in a certain range of values an increase in the variable is desirable, while in another range it is a decrease of the variable that is desirable. In this paper, a DEA model that solves problems considering non-monotonic variables is proposed. An application to assess the macroeconomic efficiency of European Union Member States, as regards taxation, gross debt, GDP growth and employment is presented.

Keywords: DEA; non-monotonic variables; membership functions; macroeconomic efficiency (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1057/jors.2016.36

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