Accelerating large-scale DEA computation using sequential categorization and dynamic reference set selection

Abstract

Data envelopment analysis (DEA) is a well-known data-enabled analytic tool for evaluating relative efficiency of units with multiple inputs and multiple outputs. The DEA computation increases substantially in the presence of large samples. In this study, we first recall two lemmas to distinguish efficient units using arithmetic operations without solving linear programming (LP). Using the used lemmas, the total sample of units is partitioned into several sequential blocks, where units in the preceding blocks are relatively efficient to those in the subsequent blocks. A novel reference set selection procedure is then formulated. We implement the proposed approach into one of the fastest existing methods and demonstrate a significant improvement in elapsed time. We conduct simulation experiments and illustrate the outcomes across varying dimensions, cardinality, and density.