Xu, Jin and Zervopoulos, Panagiotis and Qian, Zhenhua and Cheng, Gang (2012): A universal solution for units-invariance in data envelopment analysis.
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The directional distance function model is a generalization of the radial model in data envelopment analysis (DEA). The directional distance function model is appropriate for dealing with cases where undesirable outputs exist. However, it is not a units-invariant measure of efficiency, which limits its accuracy. In this paper, we develop a data normalization method for DEA, which is a universal solution for the problem of units-invariance in DEA. The efficiency scores remain unchanged when the original data are replaced with the normalized data in the existing units-invariant DEA models, including the radial and slack-based measure models, i.e., the data normalization method is compatible with the radial and slack-based measure models. Based on normalized data, a units-invariant efficiency measure for the directional distance function model is defined.
|Item Type:||MPRA Paper|
|Original Title:||A universal solution for units-invariance in data envelopment analysis|
|Keywords:||Data Envelopment Analysis; Data normalization; Units-invariance; Directional distance function|
|Subjects:||C - Mathematical and Quantitative Methods > C0 - General > C02 - Mathematical Methods
C - Mathematical and Quantitative Methods > C6 - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling > C61 - Optimization Techniques; Programming Models; Dynamic Analysis
C - Mathematical and Quantitative Methods > C6 - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling > C67 - Input-Output Models
D - Microeconomics > D2 - Production and Organizations > D24 - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
|Depositing User:||Panagiotis Zervopoulos|
|Date Deposited:||01. Oct 2012 13:35|
|Last Modified:||13. Feb 2013 15:20|
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