Abstract
This research proposes a new method to estimate returns to scale (RTS) of decision making units (DMUs) with multiple inputs and outputs. The state of return to scale includes increasing RTS, constant RTS, decreasing RTS and evidence of congestion. The method is based on the production possibility set in the intersection form given by a set of linear inequalities. We propose and prove the necessary and sufficient conditions for the RTS estimation. With the new procedure, to estimate the RTS of a DMU is simply to check the position of the DMU on the production frontiers. We point out that the procedure is particularly important for dealing with a large number of DMUs. Therefore, it can be regarded as a complementary to the data mining.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
