A novel mixed binary linear DEA model for ranking decision-making units with preference information

Abstract

Several mixed binary linear programming models have been proposed in the literature to rank decision-making units (DMUs) in data envelopment analysis (DEA). However, some of these models fail to consider the decision-makers’ preferences. We propose a new mixed binary linear DEA model for finding the most efficient DMU by considering the decision-makers’ preferences. The model proposed in this study is motivated by the approach introduced by Toloo and Salahi (2018). We extend their model by introducing additional assurance region type I (ARI) weight restrictions (WRs) based on the decision-makers’ preferences. We show that direct addition of assurance region type II (ARII) and absolute WRs in traditional DEA models leads to infeasibility and free production problems, and we prove ARI eliminates these problems. We also show our epsilon-free model is less complicated and requires less effort to determine the best efficient unit compared with the existing epsilon-based models in the literature. We provide two real-life applications to show the applicability and exhibit the efficacy of our model.