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Non-cooperative two-stage network DEA model: Linear vs. parametric linear

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  • Guo, Chuanyin
  • Zhu, Joe

Abstract

In the data envelopment analysis (DEA) literature, linear fractional non-cooperative network DEA models for two-stage network structures are often transformed into parametric linear models. The transformed parametric linear models are then solved by computing a series of linear models when the parameter is varied. For example, Wu, Zhu, Ji, Chu and Liang (2016) provide a linear fractional non-cooperative DEA model for analyzing the reuse of undesirable intermediate outputs in a two-stage production process with a shared resources and feedback. They transformed the linear fractional model into a parametric linear model. Such approaches do not guarantee that the global optimal solution is found. We show that (variants of) linear fractional non-cooperative network DEA models can be directly transformed into a linear programing model, without the need for solving parametric linear models. This greatly reduces the computational burden and the global optimal solution is always guaranteed.

Suggested Citation

  • Guo, Chuanyin & Zhu, Joe, 2017. "Non-cooperative two-stage network DEA model: Linear vs. parametric linear," European Journal of Operational Research, Elsevier, vol. 258(1), pages 398-400.
  • Handle: RePEc:eee:ejores:v:258:y:2017:i:1:p:398-400
    DOI: 10.1016/j.ejor.2016.11.039
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    References listed on IDEAS

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    1. Wu, Jie & Zhu, Qingyuan & Ji, Xiang & Chu, Junfei & Liang, Liang, 2016. "Two-stage network processes with shared resources and resources recovered from undesirable outputs," European Journal of Operational Research, Elsevier, vol. 251(1), pages 182-197.
    2. Chen, Yao & Du, Juan & David Sherman, H. & Zhu, Joe, 2010. "DEA model with shared resources and efficiency decomposition," European Journal of Operational Research, Elsevier, vol. 207(1), pages 339-349, November.
    3. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    4. Cook, Wade D. & Hababou, Moez, 2001. "Sales performance measurement in bank branches," Omega, Elsevier, vol. 29(4), pages 299-307, August.
    5. Liang Liang & Feng Yang & Wade Cook & Joe Zhu, 2006. "DEA models for supply chain efficiency evaluation," Annals of Operations Research, Springer, vol. 145(1), pages 35-49, July.
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    Cited by:

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    7. Lim, Dong-Joon & Kim, Moon-Su, 2022. "Measuring dynamic efficiency with variable time lag effects," Omega, Elsevier, vol. 108(C).
    8. Kao, Chiang, 2018. "Multiplicative aggregation of division efficiencies in network data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 270(1), pages 328-336.
    9. Khoveyni, Mohammad & Fukuyama, Hirofumi & Eslami, Robabeh & Yang, Guo-liang, 2019. "Variations effect of intermediate products on the second stage in two-stage processes," Omega, Elsevier, vol. 85(C), pages 35-48.
    10. Mohammad Nemati & Reza Kazemi Matin & Mehdi Toloo, 2020. "A two-stage DEA model with partial impacts between inputs and outputs: application in refinery industries," Annals of Operations Research, Springer, vol. 295(1), pages 285-312, December.
    11. Qingxian An & Ping Wang & Honglin Yang & Zongrun Wang, 2021. "Fixed cost allocation in two-stage system using DEA from a noncooperative view," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 43(4), pages 1077-1102, December.
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