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A proxy approach to dealing with the infeasibility problem in super-efficiency data envelopment analysis

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  • Cheng, Gang
  • Zervopoulos, Panagiotis

Abstract

Super-efficiency data envelopment analysis (SE-DEA) models are expressions of the traditional DEA models featuring the exclusion of the unit under evaluation from the reference set. The SE-DEA models have been applied in various cases such as sensitivity and stability analysis, measurement of productivity changes,outliers’ identification,and classification and ranking of decision making units (DMUs). A major deficiency in the SE-DEA models is their infeasibility in determining super-efficiency scores for some efficient DMUs when variable, non-increasing and non-decreasing returns to scale (VRS, NIRS, NDRS) prevail. The scope of this study is the development of an oriented proxy approach for SE-DEA models in order to tackle the infeasibility problem. The proxy introduced to the SE-DEA models replaces the original infeasible DMU in the sample and guarantees a feasible optimal solution. The proxy approach yields the same scores as the traditional SE-DEA models to the feasible DMUs.

Suggested Citation

  • Cheng, Gang & Zervopoulos, Panagiotis, 2012. "A proxy approach to dealing with the infeasibility problem in super-efficiency data envelopment analysis," MPRA Paper 42064, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:42064
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    File URL: https://mpra.ub.uni-muenchen.de/42064/2/MPRA_paper_42064.pdf
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    References listed on IDEAS

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    1. Per Andersen & Niels Christian Petersen, 1993. "A Procedure for Ranking Efficient Units in Data Envelopment Analysis," Management Science, INFORMS, vol. 39(10), pages 1261-1264, October.
    2. Lee, Hsuan-Shih & Chu, Ching-Wu & Zhu, Joe, 2011. "Super-efficiency DEA in the presence of infeasibility," European Journal of Operational Research, Elsevier, vol. 212(1), pages 141-147, July.
    3. 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.
    4. Chen, Yao, 2005. "Measuring super-efficiency in DEA in the presence of infeasibility," European Journal of Operational Research, Elsevier, vol. 161(2), pages 545-551, March.
    5. 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.
    6. Chambers, Robert G. & Chung, Yangho & Fare, Rolf, 1996. "Benefit and Distance Functions," Journal of Economic Theory, Elsevier, vol. 70(2), pages 407-419, August.
    7. Mei Xue & Patrick T. Harker, 2002. "Note: Ranking DMUs with Infeasible Super-Efficiency DEA Models," Management Science, INFORMS, vol. 48(5), pages 705-710, May.
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    More about this item

    Keywords

    Data envelopment analysis (DEA); Super-efficiency (SE); Infeasibility; Orientation;

    JEL classification:

    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models

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