Marginal rates in DEA using defining hyperplanes of PPS with CRS technology

A. Ghazi and F. Hosseinzadeh Lotfi ()
Additional contact information
A. Ghazi: Central Tehran Branch, Islamic Azad University
F. Hosseinzadeh Lotfi: Science and Research Branch, Islamic Azad University

Operational Research, 2023, vol. 23, issue 1, No 11, 37 pages

Abstract: Abstract Data envelopment analysis (DEA) was proposed in a highly influential paper by Charnes et al. (J Oper Res 2:429–444, 1978), who developed the Farrell seminal research (J R Stat Soc 120:253–290, 1957). The aim of the present research is calculating marginal rates for strong and weak efficient decision making units (DMUs) using the defining hyperplanes of the production possibility set (PPS). Toward this end, there are three essential objectives in the current study: (1) Implement Farrell’s idea to construct a new PPS called the Farrell PPS. In doing so, important relationships were discovered between the PPSs with constant returns to scale (CRS), non-increasing returns to scale, and non-decreasing returns to scale technologies. (2) Apply the newly constructed Farrell PPS as a catalyst to obtain strong and weak efficient DMUs and explicit form equations of strong and weak defining hyperplanes for the PPS with CRS technology. In order to do this task, a multiple objective linear programming problem is proposed whose structure for the decision space of the criterion space is similar to the proposed Farrell PPS. (3) Calculate the marginal rates for strong and weak efficient DMUs using the obtained explicit form equations of strong and weak defining hyperplanes for the PPS with CRS technology. Finally, an empirical study in the Iranian banking sector is used to show the applicability of the proposed methods.

Keywords: Data envelopment analysis; Multiple objective linear programming; Farrell efficiency measure; Defining hyperplane; Marginal rates (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s12351-023-00743-3 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:operea:v:23:y:2023:i:1:d:10.1007_s12351-023-00743-3

Ordering information: This journal article can be ordered from
https://www.springer ... search/journal/12351

DOI: 10.1007/s12351-023-00743-3

Access Statistics for this article

Operational Research is currently edited by Nikolaos F. Matsatsinis, John Psarras and Constantin Zopounidis

More articles in Operational Research from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().