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A joint measurement of efficiency and effectiveness for non-storable commodities: Integrated data envelopment analysis approaches

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  • Chiou, Yu-Chiun
  • Lan, Lawrence W.
  • Yen, Barbara T.H.

Abstract

Efficiency and effectiveness for non-storable commodities represent two distinct dimensions and a joint measurement of both is necessary to fully capture the overall performance. This paper proposes two novel integrated data envelopment analysis (IDEA) approaches, the integrated Charnes, Cooper and Rhodes (ICCR) and integrated Banker, Charnes and Cooper (IBCC) models, to jointly analyze the overall performance of non-storable commodities under constant and variable returns to scale technologies. The core logic of the proposed models is simultaneously determining the virtual multipliers associated with inputs, outputs, and consumption by additive specifications for technical efficiency and service effectiveness terms with equal weights. We show that both ICCR and IBCC models possess the essential properties of rationality, uniqueness, and benchmarking power. A case analysis also demonstrates that the proposed novel IDEA approaches have higher benchmarking power than the conventional separate DEA approaches. More generalized specifications of IDEA models with unequal weights are also elaborated.

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  • Chiou, Yu-Chiun & Lan, Lawrence W. & Yen, Barbara T.H., 2010. "A joint measurement of efficiency and effectiveness for non-storable commodities: Integrated data envelopment analysis approaches," European Journal of Operational Research, Elsevier, vol. 201(2), pages 477-489, March.
    • Handle: RePEc:eee:ejores:v:201:y:2010:i:2:p:477-489
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