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DEA and Time Substitution

In: ADVANCES IN DATA ENVELOPMENT ANALYSIS

Author

Listed:
  • Rolf Färe
  • Shawna Grosskopf
  • Dimitris Margaritis

Abstract

This chapter addresses a single DEA topic, time substitution. This topic is the study of how to allocate resources in time, with the two options (i) determine when to apply inputs and (ii) how long, i.e., in how many periods should inputs be used. These options allow the decision maker to determine when to start production and for how long to produce. The topic was initiated by Shephard and Färe (1980) in connection with ship building, refined by Färe and Grosskopf (1996), and finally given a DEA formulation by Färe, Grosskopf, and Margaritis (2010). Their results are presented and generalized here.After an introductory theoretical presentation we devote the rest of the chapter to an empirical application examining the Pact for Stability and Growth adopted by the countries comprising the single currency Euro zone.

Suggested Citation

  • Rolf Färe & Shawna Grosskopf & Dimitris Margaritis, 2015. "DEA and Time Substitution," World Scientific Book Chapters, in: ADVANCES IN DATA ENVELOPMENT ANALYSIS, chapter 5, pages 69-86, World Scientific Publishing Co. Pte. Ltd..
    • Handle: RePEc:wsi:wschap:9789814644556_0005
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