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Efficiency measures and computational approaches for data envelopment analysis models with ratio inputs and outputs

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  • Olesen, Ole Bent
  • Petersen, Niels Christian
  • Podinovski, Victor V.

Abstract

In a recent paper to this journal, the authors developed a methodology that allows the incorporation of ratio inputs and outputs in the variable and constant returns-to-scale DEA models. Practical evaluation of efficiency of decision making units (DMUs) in such models generally goes beyond the application of standard linear programming techniques. In this paper we discuss how the DEA models with ratio measures can be solved. We also introduce a new type of potential ratio (PR) inefficiency. It characterizes DMUs that are strongly efficient in the model of technology with ratio measures but become inefficient if the volume data used to calculate ratio measures become available. Potential ratio inefficiency can be tested by the programming approaches developed in this paper.

Suggested Citation

  • Olesen, Ole Bent & Petersen, Niels Christian & Podinovski, Victor V., 2017. "Efficiency measures and computational approaches for data envelopment analysis models with ratio inputs and outputs," European Journal of Operational Research, Elsevier, vol. 261(2), pages 640-655.
    • Handle: RePEc:eee:ejores:v:261:y:2017:i:2:p:640-655
    DOI: 10.1016/j.ejor.2017.02.021
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    Cited by:

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    2. Dariush Akbarian, 2021. "Network DEA based on DEA-ratio," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 7(1), pages 1-26, December.
    3. Mozaffari, Mohammad Reza & Dadkhah, Fatemeh & Jablonsky, Josef & Wanke, Peter Fernandes, 2020. "Finding efficient surfaces in DEA-R models," Applied Mathematics and Computation, Elsevier, vol. 386(C).
    4. Mehdiloozad, Mahmood & Podinovski, Victor V., 2018. "Nonparametric production technologies with weakly disposable inputs," European Journal of Operational Research, Elsevier, vol. 266(1), pages 247-258.
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    7. Podinovski, Victor V. & Wu, Junlin & Argyris, Nikolaos, 2024. "Production trade-offs in models of data envelopment analysis with ratio inputs and outputs: An application to schools in England," European Journal of Operational Research, Elsevier, vol. 313(1), pages 359-372.
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    11. D’Inverno, Giovanna & Smet, Mike & De Witte, Kristof, 2021. "Impact evaluation in a multi-input multi-output setting: Evidence on the effect of additional resources for schools," European Journal of Operational Research, Elsevier, vol. 290(3), pages 1111-1124.
    12. Ole Bent Olesen & Niels Christian Petersen & Victor V. Podinovski, 2022. "The structure of production technologies with ratio inputs and outputs," Journal of Productivity Analysis, Springer, vol. 57(3), pages 255-267, June.
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    14. Victoria Wojcik & Harald Dyckhoff & Marcel Clermont, 2019. "Is data envelopment analysis a suitable tool for performance measurement and benchmarking in non-production contexts?," Business Research, Springer;German Academic Association for Business Research, vol. 12(2), pages 559-595, December.
    15. Mohammad Reza Mozaffari & Sahar Ostovan & Peter Fernandes Wanke, 2020. "A Hybrid Genetic Algorithm-Ratio DEA Approach for Assessing Sustainable Efficiency in Two-Echelon Supply Chains," Sustainability, MDPI, vol. 12(19), pages 1-17, September.
    16. Boďa, Martin, 2024. "Financial depth versus more comprehensive metrics of financial development in tests of the finance-growth nexus," Economic Systems, Elsevier, vol. 48(1).
    17. Ole Bent Olesen & Niels Christian Petersen & Victor V. Podinovski, 2022. "Scale characteristics of variable returns-to-scale production technologies with ratio inputs and outputs," Annals of Operations Research, Springer, vol. 318(1), pages 383-423, November.
    18. Javad Gerami & Mohammad Reza Mozaffari & P. F. Wanke & Henrique Correa, 2022. "A novel slacks-based model for efficiency and super-efficiency in DEA-R," Operational Research, Springer, vol. 22(4), pages 3373-3410, September.
    19. Boďa, Martin & Zimková, Emília, 2021. "Overcoming the loan-to-deposit ratio by a financial intermediation measure — A perspective instrument of financial stability policy," Journal of Policy Modeling, Elsevier, vol. 43(5), pages 1051-1069.
    20. Mehmet Cahit GÜRAN & Emine AYRANCI, 2019. "Efficiency Changes in Higher Education in OECD Countries: Implementation of Malmquist Total Factor Productivity Index for 2000 and 2012 PeriodAbstract: This study analyzes the total factor productivit," Sosyoekonomi Journal, Sosyoekonomi Society, issue 27(41).
    21. Zha, Jianping & He, Lamei & Liu, Yang & Shao, Yuhong, 2019. "Evaluation on development efficiency of low-carbon tourism economy: A case study of Hubei Province, China," Socio-Economic Planning Sciences, Elsevier, vol. 66(C), pages 47-57.

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