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Weighted Additive DEA Models Associated with Dataset Standardization Techniques

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  • Chen, Kaihua
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    Abstract

    This paper uncovers the“mysterious veil”above the formulations and concerned properties of existing weighted additive data envelopment analysis (WADD) models associated with dataset standardization techniques. Based on the truth that the formulation of objective functions in WADD models seems random and confused for users, the study investigates the correspondence relationship between the formulation of objective functions by statistical data-based weights aggregating slacks in WADD models and the pre-standardization of original datasets before using the traditional ADD model in terms of satisfying unit and translation invariance. Our work presents a statistical background for WADD models’ formulations, and makes them become more interpretive and more convenient to be computed and practically applied. Based on the pre-standardization techniques, two new WADD models satisfying unit invariance are formulated to enrich the family of WADD models. We compare all WADD models in some concerned properties, and give special attention to the (in)efficiency discrimination power of them. Moreover, some suggestions guiding theoretical and practical applications of WADD models are discussed.

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    Bibliographic Info

    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 55072.

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    Date of creation: Feb 2014
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    Handle: RePEc:pra:mprapa:55072

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    Keywords: Data envelopment analysis; Weighted additive models; Formulations and applications; Dataset standardization techniques;

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    1. Beniamina Buzzo Margari & Fabrizio Erbetta & Carmelo Petraglia & Massimiliano Piacenza, 2006. "Regulatory and Environmental Effects on Public Transit Efficiency. A Mixed DEA-SFA Approach," CERIS Working Paper, Institute for Economic Research on Firms and Growth - Moncalieri (TO) 200613, Institute for Economic Research on Firms and Growth - Moncalieri (TO).
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    10. Ali, Agha Iqbal & Lerme, Catherine S. & Seiford, Lawrence M., 1995. "Components of efficiency evaluation in data envelopment analysis," European Journal of Operational Research, Elsevier, Elsevier, vol. 80(3), pages 462-473, February.
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