Treating undesirable outputs in DEA: A critical review

Halkos, George; Petrou, Kleoniki Natalia

doi:10.1016/j.eap.2019.01.005

Cited by 155 publications

(53 citation statements)

References 89 publications

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“…On the other hand, the DEA model is usually either input oriented, by minimising inputs, or output oriented, by maximising outputs. There are several possible solutions for treating undesirable outputs that need to be minimised in DEA [77]: ignore them, treat them as inputs, transform the data or transform the model from linear to nonlinear form. We chose to transform the CO 2 emission data through Equation (9), introduced by Ali and Seiford [78], being the most appropriate.…”

Section: Data and Variable Selectionmentioning

confidence: 99%

Link between Energy Efficiency and Sustainable Economic and Financial Development in OECD Countries

et al. 2020

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The growing risk of climate change caused by the emission of greenhouse gases poses new challenges to contemporary countries. The development of economies is usually related to increasing levels of greenhouse gas emissions. Therefore, the question arises whether it is possible to achieve sustainable economic and financial development and simultaneously reduce greenhouse gas emissions. This paper assumes it is possible if energy efficiency is increased. The aim of the paper is to show the link between energy efficiency and sustainable economic and financial development in Organisation for Economic Co-operation and Development (OECD) countries for the period 2000–2018 by using data envelopment analysis (DEA) and regression analysis. The results show a slight upward trend of total factor energy efficiency (TFEE) in OECD countries for the analysed period; however, there is a difference in TFEE levels. Developed OECD countries have higher TFEE levels than developing OECD countries. The links between total factor energy efficiency and sustainable economic and financial development reveal different impacts depending on the variables taken into consideration.

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Section: Data and Variable Selectionmentioning

confidence: 99%

Link between Energy Efficiency and Sustainable Economic and Financial Development in OECD Countries

et al. 2020

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“…The treatment of undesirable output and technical heterogeneity in the existing literature is also involved. Regarding the setting of the undesired output in the DEA method, it can be divided into strong disposability and weak disposability [17]. The first is strong disposability, which can reduce undesired output without reducing expected output [18].…”

Section: Literature Reviewmentioning

confidence: 99%

“…As a non-radial method, the SBM approach is better than the traditional DEA model in identifying output and input slacks, thus measuring securities firms' operational efficiency in a more accurate manner [28,29]. For the risk variable that is regarded as an undesirable output in DEA, there are two kinds of settings, strong disposability and weak disposability [17]. The traditional DEA model assumes strong disposability in inputs and outputs.…”

Section: Efficiency Evaluation In Sbm-deamentioning

confidence: 99%

Efficiency of China’s Listed Securities Companies: Estimation through a DEA-Based Method

You

Shao

2020

Mathematics

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Accurate assessment of the efficiency of securities companies is of great significance to improve the competitiveness of companies, due to their increasingly important role in supporting economic development. As the main contribution, this paper proposes a novel efficiency estimation framework for securities companies based on data envelopment analysis (DEA), which takes into account operational risks and technical heterogeneity. First, the risk variable is incorporated in the evaluation system as an undesirable output through the setting of weak disposability. Subsequently, the meta-frontier model is introduced to consider the impact of the technical heterogeneity of different companies to improve the accuracy of the assessment. Furthermore, this article also provides the meta-frontier Malmquist model, which can be utilized to analyze in detail technological progress. Finally, the securities companies listed in the Chinese stock market were selected as samples for empirical analysis. The efficiency evaluation model for securities companies proposed in this paper will provide a reference for related evaluation issues.

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“…There are lots of discussions on undesirable inputs and undesirable outputs, please refer to [20,21] for more details. Here we treat undesirable inputs as desirable outputs, and undesirable outputs as desirable inputs by following [22].…”

Section: Approach Imentioning

confidence: 99%

Further Study of the DEA-Based Framework for Performance Evaluation of Competing Crude Oil Prices’ Volatility Forecasting Models

et al. 2019

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The super-efficiency data envelopment analysis model is innovative in evaluating the performance of crude oil prices’ volatility forecasting models. This multidimensional ranking, which takes account of multiple criteria, gives rise to a unified decision as to which model performs best. However, the rankings are unreliable because some efficiency scores are infeasible solutions in nature. What’s more, the desirability of indexes is worth discussing so as to avoid incorrect rankings. Hence, herein we introduce four models, which address the issue of undesirable characteristics of indexes and infeasibility of the super efficiency models. The empirical results reveal that the new rankings are more robust and quite different from the existing results.

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Treating undesirable outputs in DEA: A critical review

Cited by 155 publications

References 89 publications

Link between Energy Efficiency and Sustainable Economic and Financial Development in OECD Countries

Link between Energy Efficiency and Sustainable Economic and Financial Development in OECD Countries

Efficiency of China’s Listed Securities Companies: Estimation through a DEA-Based Method

Further Study of the DEA-Based Framework for Performance Evaluation of Competing Crude Oil Prices’ Volatility Forecasting Models

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