A common weight MCDA-DEA approach to construct composite indicators
A common weight multi criteria decision analysis (MCDA)-data envelopment analysis (DEA) approach is proposed to construct composite indicators (CIs). The proposed MCDA-DEA model enables the construction of CIs among all entities via a set of common weights. The model is capable to discriminate entities which receive CI score of 1, i.e., the efficient entities leading to determination of a single best entity. Common weights structure of the proposed model has more discriminating power when compared to those obtained by previous DEA-like models. In order to validate the proposed MCDA-DEA model, it is applied to two case studies taken from the literature to construct two well-known CIs, i.e., Sustainable Energy Index (SEI) and Human Development Index (HDI). Both the robustness and discriminating power of the proposed method are studied through these case studies and tested by Spearman's rank correlation coefficient. The results reveal several merits of the proposed method in constructing CIs.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Zhou, P. & Ang, B.W. & Poh, K.L., 2006. "Comparing aggregating methods for constructing the composite environmental index: An objective measure," Ecological Economics, Elsevier, vol. 59(3), pages 305-311, September.
- R. Allen & A. Athanassopoulos & R.G. Dyson & E. Thanassoulis, 1997. "Weights restrictions and value judgements in Data Envelopment Analysis: Evolution, development and future directions," Annals of Operations Research, Springer, vol. 73(0), pages 13-34, October.
- 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.
- Hope, Chris & Parker, Jonathan & Peake, Stephen, 1992. "A pilot environmental index for the UK in the 1980s," Energy Policy, Elsevier, vol. 20(4), pages 335-343, April.
- Laurens Cherchye & Erwin Oghe & Tom Van Puyenbroeck, 2005.
"Robust human development rankings,"
Public Economics Working Paper Series
ces0516, Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Working Group Public Economics.
- Michela Nardo & Michaela Saisana & Andrea Saltelli & Stefano Tarantola & Anders Hoffman & Enrico Giovannini, 2005. "Handbook on Constructing Composite Indicators: Methodology and User Guide," OECD Statistics Working Papers 2005/3, OECD Publishing.
- Kao, Chiang & Hung, Hsi-Tai, 2008. "Efficiency analysis of university departments: An empirical study," Omega, Elsevier, vol. 36(4), pages 653-664, August.
- Sagar, Ambuj D. & Najam, Adil, 1998. "The human development index: a critical review," Ecological Economics, Elsevier, vol. 25(3), pages 249-264, June.
- Ulucan, AydIn & BarIs AtIcI, KazIm, 2010. "Efficiency evaluations with context-dependent and measure-specific data envelopment approaches: An application in a World Bank supported project," Omega, Elsevier, vol. 38(1-2), pages 68-83, February.
- Laurens Cherchye & & Timo Kuosmanen, 2002.
"Benchmarking Sustainable Development: A Synthetic Meta-index Approach,"
0210001, EconWPA, revised 08 Oct 2002.
- Cherchye, Laurens & Kuosmanen, Timo, 2004. "Benchmarking Sustainable Development: A Synthetic Meta-index Approach," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Zhou, P. & Ang, B.W. & Poh, K.L., 2007. "A mathematical programming approach to constructing composite indicators," Ecological Economics, Elsevier, vol. 62(2), pages 291-297, April.
- Diaz-Balteiro, Luis & Romero, Carlos, 2004. "In search of a natural systems sustainability index," Ecological Economics, Elsevier, vol. 49(3), pages 401-405, July.
- Despotis, D.K., 2005. "Measuring human development via data envelopment analysis: the case of Asia and the Pacific," Omega, Elsevier, vol. 33(5), pages 385-390, October.
- M. Saisana & A. Saltelli & S. Tarantola, 2005. "Uncertainty and sensitivity analysis techniques as tools for the quality assessment of composite indicators," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 168(2), pages 307-323.
- Ramanathan, Ramakrishnan & Yunfeng, Jiang, 2009. "Incorporating cost and environmental factors in quality function deployment using data envelopment analysis," Omega, Elsevier, vol. 37(3), pages 711-723, June.
- Ebert, Udo & Welsch, Heinz, 2004. "Meaningful environmental indices: a social choice approach," Journal of Environmental Economics and Management, Elsevier, vol. 47(2), pages 270-283, March.
- P. Zhou & B. Ang & D. Zhou, 2010. "Weighting and Aggregation in Composite Indicator Construction: a Multiplicative Optimization Approach," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 96(1), pages 169-181, March.
- Krajnc, Damjan & Glavic, Peter, 2005. "How to compare companies on relevant dimensions of sustainability," Ecological Economics, Elsevier, vol. 55(4), pages 551-563, December.
- 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.
- Kuosmanen, Timo & Cherchye, Laurens & Sipilainen, Timo, 2006.
"The law of one price in data envelopment analysis: Restricting weight flexibility across firms,"
European Journal of Operational Research,
Elsevier, vol. 170(3), pages 735-757, May.
- Timo Kuosmanen & Laurens Cherchye & Timo Sipiläinen, 2003. "The Law of One Price in Data Envelopment Analysis: Restricting Weight Flexibility Across Firms," Microeconomics 0312006, EconWPA, revised 18 Dec 2003.
- Giuseppe Munda, 2005. "“Measuring Sustainability”: A Multi-Criterion Framework," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 7(1), pages 117-134, 01.
- Jefferson, Michael, 2006. "Sustainable energy development: performance and prospects," Renewable Energy, Elsevier, vol. 31(5), pages 571-582.
- Laurens Cherchye & Willem Moesen & Nicky Rogge & Tom Puyenbroeck, 2007. "An Introduction to ‘Benefit of the Doubt’ Composite Indicators," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 82(1), pages 111-145, May.
- Li, Xiao-Bai & Reeves, Gary R., 1999. "A multiple criteria approach to data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 115(3), pages 507-517, June.
- Roll, Y & Golany, B., 1993. "Alternate methods of treating factor weights in DEA," Omega, Elsevier, vol. 21(1), pages 99-109, January.
- Kao, Chiang, 2010. "Malmquist productivity index based on common-weights DEA: The case of Taiwan forests after reorganization," Omega, Elsevier, vol. 38(6), pages 484-491, December.
- Hajkowicz, Stefan, 2006. "Multi-attributed environmental index construction," Ecological Economics, Elsevier, vol. 57(1), pages 122-139, April.
- Zhou, Peng & Poh, Kim Leng & Ang, Beng Wah, 2007. "A non-radial DEA approach to measuring environmental performance," European Journal of Operational Research, Elsevier, vol. 178(1), pages 1-9, April.
When requesting a correction, please mention this item's handle: RePEc:eee:ecolec:v:70:y:2010:i:1:p:114-120. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamier, Wendy)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.