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New posterior distributions for the incidence of inefficiency in DEA scores

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  • Mehmet Güray Ünsal
  • Daniel Friesner
  • Robert Rosenman

Abstract

This note derives posterior distributions for the incidence of data envelopment analysis generated inefficiency scores when sampling occurs with replacement or whether the population approaches infinity. The posterior distributions are flexible, tractable, and applicable to a variety of empirical settings. HighlightsData envelopment analysis may generate inaccurate efficiency scores, especially when the sample size is small relative to the number of inputs and outputsWe derive posterior distributions for the incidence of inefficiency in the presence of this inaccuracy.The derived posterior distributions are computationally tractable, especially in situation when the inaccuracy is more pronounced.

Suggested Citation

  • Mehmet Güray Ünsal & Daniel Friesner & Robert Rosenman, 2021. "New posterior distributions for the incidence of inefficiency in DEA scores," Communications in Statistics - Theory and Methods, Taylor & Francis Journals, vol. 50(8), pages 1774-1780, April.
    • Handle: RePEc:taf:lstaxx:v:50:y:2021:i:8:p:1774-1780
    DOI: 10.1080/03610926.2019.1653920
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