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A data envelopment analysis approach to clustering operating units for resource allocation purposes

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  • Thanassoulis, E.
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    Abstract

    Bodies such as those funding education or health services normally make use of marginal resource levels (e.g. the level of funding per pupil) to allocate resources to operating units. It is typically desired that marginal resource levels should encourage the operating units to use resources as efficiently as possible. This paper develops a method for simultaneously clustering operating units and determining a different set of marginal resource levels for resourcing the units of each cluster, consistent with the foregoing aim. The user controls the number of clusters created, striking a balance between the multiplicity of sets of marginal resource levels estimated and the strength of the incentive offered to operating units to use a resource efficiently. The clusters identified can prove useful in themselves in that operating units sharing similar environmental conditions and/or value systems are identified.

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    Bibliographic Info

    Article provided by Elsevier in its journal Omega.

    Volume (Year): 24 (1996)
    Issue (Month): 4 (August)
    Pages: 463-476

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    Handle: RePEc:eee:jomega:v:24:y:1996:i:4:p:463-476

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    Related research

    Keywords: Key words-clustering data envelopment analysis marginal resource levels performance measurement resource allocation;

    References

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    1. 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.
    2. Boussofiane, A. & Dyson, R. G. & Thanassoulis, E., 1991. "Applied data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 52(1), pages 1-15, May.
    3. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    4. Michael Barrow & Adam Wagstaff, 1989. "Efficiency measurement in the public sector: an appraisal," Fiscal Studies, Institute for Fiscal Studies, vol. 10(1), pages 72-97, February.
    5. Thanassoulis, E. & Dyson, R. G., 1992. "Estimating preferred target input-output levels using data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 56(1), pages 80-97, January.
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    Citations

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    Cited by:
    1. Aleskerov, Fuad & Ersel, Hasan & Yolalan, Reha, 2003. "Personnel allocation among bank branches using a two-stage multi-criterial approach," European Journal of Operational Research, Elsevier, vol. 148(1), pages 116-125, July.
    2. repec:lan:wpaper:1109 is not listed on IDEAS
    3. repec:lan:wpaper:1046 is not listed on IDEAS
    4. repec:lan:wpaper:1031 is not listed on IDEAS
    5. Giokas, Dimitris I., 2001. "Greek hospitals: how well their resources are used," Omega, Elsevier, vol. 29(1), pages 73-83, February.
    6. Thanassoulis, Emmanuel, 2000. "The use of data envelopment analysis in the regulation of UK water utilities: Water distribution," European Journal of Operational Research, Elsevier, vol. 126(2), pages 436-453, October.
    7. E Thanassoulis & M Kortelainen & G Johnes & J Johnes, 2009. "Costs and Efficiency of Higher Education Institutions in England: A DEA Analysis," Working Papers 598827, Lancaster University Management School, Economics Department.
    8. Yu, Ming-Miin & Chern, Ching-Chin & Hsiao, Bo, 2013. "Human resource rightsizing using centralized data envelopment analysis: Evidence from Taiwan's Airports," Omega, Elsevier, vol. 41(1), pages 119-130.
    9. Paradi, Joseph C. & Zhu, Haiyan & Edelstein, Barak, 2012. "Identifying managerial groups in a large Canadian bank branch network with a DEA approach," European Journal of Operational Research, Elsevier, vol. 219(1), pages 178-187.
    10. Beasley, J. E., 2003. "Allocating fixed costs and resources via data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 147(1), pages 198-216, May.

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