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On Returns to Scale under Weight Restrictions in Data Envelopment Analysis

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  • Kaoru Tone

Abstract

Weextend the concept of returns to scale in Data Envelopment Analysis(DEA) to the weight restriction environments. By the additionof weight restrictions, the status of returns to scale, i.e., increasing, constant and decreasing may suffer a change. Wefirst define ``returns to scale'' under weight restrictions andpropose a method for identifying the status of returns to scale.Then, it is demonstrated that the region of the most productivescale size (MPSS) will usually be narrowed by this addition.For an inefficient decision making unit (DMU), a simple rulefor determining the status of returns to scale of its projectedDMU will be presented. An empirical study compares the resultsof the proposed method with those of the BCC model and demonstratesthe change in the MPSS for both models. Copyright Kluwer Academic Publishers 2001

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  • Kaoru Tone, 2001. "On Returns to Scale under Weight Restrictions in Data Envelopment Analysis," Journal of Productivity Analysis, Springer, vol. 16(1), pages 31-47, July.
    • Handle: RePEc:kap:jproda:v:16:y:2001:i:1:p:31-47
    DOI: 10.1023/A:1011147118637
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    7. Alireza Amirteimoori & Biresh K. Sahoo & Saber Mehdizadeh, 2023. "Data envelopment analysis for scale elasticity measurement in the stochastic case: with an application to Indian banking," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-36, December.
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    11. Victor V. Podinovski & Robert G. Chambers & Kazim Baris Atici & Iryna D. Deineko, 2016. "Marginal Values and Returns to Scale for Nonparametric Production Frontiers," Operations Research, INFORMS, vol. 64(1), pages 236-250, February.
    12. Podinovski, Victor V., 2017. "Returns to scale in convex production technologies," European Journal of Operational Research, Elsevier, vol. 258(3), pages 970-982.
    13. Korhonen, Pekka J. & Soleimani-damaneh, Majid & Wallenius, Jyrki, 2011. "Ratio-based RTS determination in weight-restricted DEA models," European Journal of Operational Research, Elsevier, vol. 215(2), pages 431-438, December.
    14. Alirezaee, Mohammadreza & Hajinezhad, Ensie & Paradi, Joseph C., 2018. "Objective identification of technological returns to scale for data envelopment analysis models," European Journal of Operational Research, Elsevier, vol. 266(2), pages 678-688.
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