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Testing over-representation of observations in subsets of a DEA technology

Author

Listed:
  • Mette Asmild

    (Warwick Business School, University of Warwick)

  • Jens Leth Hougaard

    (Department of Food and Resource Economics, University of Copenhagen)

  • Ole B. Olesen

    (Department of Business and Economics, University of Southern Denmark)

Abstract

This paper proposes a test for whether data are over-represented in a given production zone, i.e. a subset of a production possibility set which has been estimated using the non-parametric Data Envelopment Analysis (DEA) approach. A binomial test is used that relates the number of observations inside such a zone to a discrete probability weighted relative volume of that zone. A Monte Carlo simulation illustrates the performance of the proposed test statistic and suggests good estimation of both facet probabilities and the assumed common inefficiency distribution in a three dimensional input space.

Suggested Citation

  • Mette Asmild & Jens Leth Hougaard & Ole B. Olesen, 2010. "Testing over-representation of observations in subsets of a DEA technology," MSAP Working Paper Series 04_2010, University of Copenhagen, Department of Food and Resource Economics.
    • Handle: RePEc:foi:msapwp:04_2010
    as

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    References listed on IDEAS

    as
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    6. Léopold Simar & Paul W. Wilson, 1998. "Sensitivity Analysis of Efficiency Scores: How to Bootstrap in Nonparametric Frontier Models," Management Science, INFORMS, vol. 44(1), pages 49-61, January.
    7. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    8. Nam Anh Tran & Gerald Shively & Paul Preckel, 2010. "A new method for detecting outliers in Data Envelopment Analysis," Applied Economics Letters, Taylor & Francis Journals, vol. 17(4), pages 313-316.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Data Envelopment Analysis (DEA); Over-representation; Data density; Binomial test; Convex hull;
    All these keywords.

    JEL classification:

    • C00 - Mathematical and Quantitative Methods - - General - - - General
    • C40 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - General
    • C60 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - General
    • C80 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - General

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