A multiplier bound approach to assess relative efficiency in DEA without slacks

Ramon, Núria Tous; Ruiz, José L.; Sirvent, Inmaculada

doi:10.1016/j.ejor.2009.07.009

Cited by 37 publications

(43 citation statements)

References 40 publications

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“…Some literatures identified different key performance indicators, including tangible and intangible aspects [8][9][10][11][12][13][14]. It is essential for performance measurement application that a company's tangible and intangible targets are defined in a way that is more appropriate to the requirements and objects of these targets and that company strategy is more extensively operationalized, quantified, and linked in a mutually supportive way [15][16][17][18].…”

Section: Introductionmentioning

confidence: 99%

Assessing the Relative Efficiency and Productivity Growth of the Taiwan LED Industry: DEA and Malmquist Indices Application

Sun

2014

Mathematical Problems in Engineering

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With the rapid acceleration of global competition the need has arisen for a more systematic performance evaluation system. This research develops a two-stage performance evaluation system to help maximize performance evaluation success. The performance evaluation is an important approach for enterprises to give incentives and restraint to their operators. It is also an important channel for enterprise stakeholders to obtain performance information. This study analyzes the current evaluation system for the Taiwan LED industry. This research measures the performance of ten LED companies in Taiwan for the period 2003–2009. The proposed method is practical and useful. The evaluation model indicates that proposed method is more reasonable and easier to grasp than other methods. As a result, it is easier to popularize this evaluation method in enterprises. The proposed method presents a complete assessment model that helps managers identify items for improvement, while simultaneously promoting cost and time efficiencies in the LED industry.

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Section: Introductionmentioning

confidence: 99%

Assessing the Relative Efficiency and Productivity Growth of the Taiwan LED Industry: DEA and Malmquist Indices Application

Sun

2014

Mathematical Problems in Engineering

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“…Thus, the focus of the cross-efficiency evaluation approach proposed in this paper is on the weight profile choice of each DMU, in an attempt to prevent unrealistic weighting schemes. Specifically, the model involves extending the multiplier bound approach to the assessment of efficiency without slacks (Ramón et al, 2010a) for use in cross-efficiency evaluations, which ensures nonzero weights and aims to avoid large differences in weights.…”

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confidence: 99%

“…Cook and Seiford (2008) noted, "The AR [assurance region] concept was developed to prohibit large differences in the values of multipliers" (p. 8). The approach in Ramón et al (2010a) relates to the assessment of the DMUs having nonzero slacks in their optimal solutions in the CCR model (i.e., those in F NF ∪ 1 ), evaluated after specifying a limit for the allowable differences in weights determined by using the optimal solutions of the extreme efficient units (the DMUs in E) with the least dissimilar weights. The approach also guarantees nonzero weights.…”

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confidence: 99%

Avoiding Large Differences in Weights in Cross-Efficiency Evaluations: Application to the Ranking of Basketball Players

Cooper¹,

Ramon²,

Ruiz³

et al. 2011

JCC: The Business and Economics Research Journal

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Because of data envelopment analysis (DEA) flexibility in the choice of weights, assessment of decisionmaking units (DMUs) often involves weighting only a few inputs and outputs and ignoring the remaining variables by assigning them a zero weight. Widespread literature indicates the need to avoid zero weights, and some authors claim that the fact that a given DMU attaches very different weights to the variables involved in the assessments may be a concern (see, for example, Cooper, Seiford, & Tone, 2007). The aim of this paper was to prevent unrealistic weighting schemes in cross-efficiency evaluations through an extension of the multiplier bound approach (Ramón, Ruiz, & Sirvent, 2010a) based on "model" DMUs. The approach in that paper guarantees nonzero weights while at the same time it tries to avoid large differences in the values of multipliers. An application to the ranking of basketball players involved specifying a limit for allowable differences in the relative importance that players attach to different aspects of the game by reflecting those observed in the weight profiles of some model players, which are selected according to expert opinion. The approach provided results that are consistent with basketball expert opinion and illustrated why the classical approaches to cross-efficiency evaluation, which include the benevolent and aggressive formulations, may lead to unreasonable results.

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“…This may generate assignment results with extreme weights. Specifically, the DEA often assigns weights to a few inputs and outputs in the process of evaluation, ignoring the remaining inputs and outputs by assigning them very small (or even zero) weights [33]. With this scenario, in the configurations of weighted inputs and outputs, some input or output variables with zero weights do not contribute to the efficiency of evaluated DMUs.…”

Section: Introductionmentioning

confidence: 99%

“…That is to say, each input or output in the proposed models can be used as much as possible during the evaluation process. Third, taking into account issues similar to those considered in our study, Ramn et al [33,34] proposed a multiplier bound approach for assessment of efficiency without slacks. Different from their study, our models choose profiles with similar weighted inputs and outputs, not weight.…”

Section: Introductionmentioning

confidence: 99%