Improving the Sensitivity of Data Envelopment Analysis by Reducing Dimensionality

Kevin Fox, Robert Hill () and R.J.

Working Papers from New South Wales - School of Economics

Abstract: Sata Envelopment Analysis (DEA) of efficiency is highly sensitive to the level of aggregation. Generally as the number of inputs and outputs increase, differences in measured relative efficiency across firms decrease. This paper advocates using the EKS index number formula to aggreagte inputs and outputs into a single input and output index prior to using DEA.

Keywords: PHARMACEUTICAL INDUSTRY; STATISTICS (search for similar items in EconPapers)
JEL-codes: C43 C61 D24 (search for similar items in EconPapers)
Pages: 14 pages
Date: 1996
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Persistent link: https://EconPapers.repec.org/RePEc:fth:nesowa:96/1

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