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The Russell measure model: Computational aspects, duality, and profit efficiency

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  • Halická, Margaréta
  • Trnovská, Mária

Abstract

Throughout its evolution, data envelopment analysis (DEA) has mostly relied on linear programming, particularly because of simple primal–dual relations and the existence of standard software for solving linear programs. Although also nonlinear models, such as Russell measure or hyperbolic measure models, have been introduced, their use in applications has been limited mainly because of their computational inconvenience. The common feature of these nonlinear models is that some unknown variables appear in the form of reciprocal values. In this paper, we introduce a novel method for dealing with this type of nonlinearity in DEA. We show how to reformulate the nonlinear model as a semidefinite programming (SDP) problem and describe how to derive the corresponding dual counterpart of the model. Two benefits of our approach are: (1) the SDP reformulated model can be solved efficiently using standard SDP solvers and, (2) the derived dual program is comparable with the multiplier forms of some linear DEA models. Our approach is applied to the Russell measure model for which its dual (multiplier) form is derived, and its relation to the profit efficiency is established. The significance of the dual Russell measure model is documented by several illustrative examples.

Suggested Citation

  • Halická, Margaréta & Trnovská, Mária, 2018. "The Russell measure model: Computational aspects, duality, and profit efficiency," European Journal of Operational Research, Elsevier, vol. 268(1), pages 386-397.
    • Handle: RePEc:eee:ejores:v:268:y:2018:i:1:p:386-397
    DOI: 10.1016/j.ejor.2018.01.012
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