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An aggregate measure of financial ratios using a multiplicative DEA model

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  • Ali Emrouznejad
  • Emilyn Cabanda

Abstract

This paper examines the problems in the definition of the General Non-Parametric Corporate Performance (GNCP) and introduces a multiplicative linear programming as an alternative model for corporate performance. We verified and tested a statistically significant difference between the two models based on the application of 27 UK industries using six performance ratios. Our new model is found to be a more robust performance model than the previous standard Data Envelopment Analysis (DEA) model.

Suggested Citation

  • Ali Emrouznejad & Emilyn Cabanda, 2010. "An aggregate measure of financial ratios using a multiplicative DEA model," International Journal of Financial Services Management, Inderscience Enterprises Ltd, vol. 4(2), pages 114-126.
    • Handle: RePEc:ids:ijfsmg:v:4:y:2010:i:2:p:114-126
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    References listed on IDEAS

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    10. S. Blancard & J.Ph. Boussemart & M. Debruyne, 2006. "Assessing managerial performance using non-parametric distance functions compared to technical and accounting ratio analysis: an application to French farms in Nord-Pas-de-Calais specialized in field ," Post-Print hal-00256882, HAL.
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    Cited by:

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    2. Mehdiloozad, Mahmood & Sahoo, Biresh K. & Roshdi, Israfil, 2014. "A generalized multiplicative directional distance function for efficiency measurement in DEA," European Journal of Operational Research, Elsevier, vol. 232(3), pages 679-688.
    3. Van Puyenbroeck, Tom & Rogge, Nicky, 2017. "Geometric mean quantity index numbers with Benefit-of-the-Doubt weights," European Journal of Operational Research, Elsevier, vol. 256(3), pages 1004-1014.
    4. Diogo Cunha Ferreira & Rui Cunha Marques & Alexandre Morais Nunes, 2021. "Pay for performance in health care: a new best practice tariff-based tool using a log-linear piecewise frontier function and a dual–primal approach for unique solutions," Operational Research, Springer, vol. 21(3), pages 2101-2146, September.

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