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A simple derivation of scale elasticity in data envelopment analysis

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  • Podinovski, Victor V.
  • Førsund, Finn R.
  • Krivonozhko, Vladimir E.

Abstract

In this paper, we suggest a simple derivation of the formulae for the scale elasticity in the variable returns-to-scale technology as used in data envelopment analysis. Our development is consistent with the existing literature but the proof is much shorter and applies to the general case without any simplifying conditions.

Suggested Citation

  • Podinovski, Victor V. & Førsund, Finn R. & Krivonozhko, Vladimir E., 2009. "A simple derivation of scale elasticity in data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 197(1), pages 149-153, August.
    • Handle: RePEc:eee:ejores:v:197:y:2009:i:1:p:149-153
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    References listed on IDEAS

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    1. Banker, Rajiv D. & Thrall, R. M., 1992. "Estimation of returns to scale using data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 62(1), pages 74-84, October.
    2. V E Krivonozhko & O B Utkin & A V Volodin & I A Sablin & M Patrin, 2004. "Constructions of economic functions and calculations of marginal rates in DEA using parametric optimization methods," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 55(10), pages 1049-1058, October.
    3. Førsund, Finn R. & Kittelsen, Sverre A. & Krivonozhko, Vladimir E., 2007. "Farrell Revisited: Visualising the DEA Production Frontier," Memorandum 15/2007, Oslo University, Department of Economics.
    4. F R Førsund & L Hjalmarsson, 2004. "Calculating scale elasticity in DEA models," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 55(10), pages 1023-1038, October.
    5. Hanoch, Giora, 1970. "Homotheticity in joint production," Journal of Economic Theory, Elsevier, vol. 2(4), pages 423-426, December.
    6. Finn Førsund & Lennart Hjalmarsson & Vladimir Krivonozhko & Oleg Utkin, 2007. "Calculation of scale elasticities in DEA models: direct and indirect approaches," Journal of Productivity Analysis, Springer, vol. 28(1), pages 45-56, October.
    7. Starrett, David A, 1977. "Measuring Returns to Scale in the Aggregate, and the Scale Effect of Public Goods," Econometrica, Econometric Society, vol. 45(6), pages 1439-1455, September.
    8. Banker, Rajiv D. & Cooper, William W. & Seiford, Lawrence M. & Thrall, Robert M. & Zhu, Joe, 2004. "Returns to scale in different DEA models," European Journal of Operational Research, Elsevier, vol. 154(2), pages 345-362, April.
    9. 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.
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