Abstract
Conventional DEA models make no hypothesis concerning the internal operations in a static situation. To open the “black box” and work with dynamic assessment issues synchronously, we put forward a hybrid model for evaluating the relative efficiencies of a set of DMUs over an observed time period with a composite of network DEA and dynamic DEA. We vertically deal with intermediate products between divisions with assignable inputs in the network structure and, horizontally, we extend network structure by means of a dynamic pattern with unrelated activities between two succeeding periods. The hybrid dynamic network DEA model proposed in this paper enables us to (i) pry into the internal operations of DEA by another network structure, (ii) obtain dynamic change of period efficiency, and (iii) gain the overall dynamic efficiency of DMUs over the entire observed periods. We finally illustrate the calculation procedure of the proposed approach by a numerical example.
Highlights
Data envelopment analysis (DEA), originated by Charnes, Cooper, and Rhodes, is a nonparametric approach for measuring the relative efficiency of homogeneous decision making units (DMUs), which use similar inputs to produce similar outputs [1]
Traditional DEA approach is based on the thinking of “black box,” which requires no assumption on the appearance of the frontier surface and it makes no hypothesis concerning the internal operations of a DMU
We put forward a hybrid dynamic network DEA model, taking dynamic assessment and network structure in DEA into consideration simultaneously
Summary
Data envelopment analysis (DEA), originated by Charnes, Cooper, and Rhodes, is a nonparametric approach for measuring the relative efficiency of homogeneous decision making units (DMUs), which use similar inputs to produce similar outputs [1]. The development of network DEA model has come through four phases as follows: Firstly, Fare et al [6] studied allocation of farmland to various crops, which allows for allocation of a (fixed) factor or input among alternative uses. This general structure could be used to introduce allocation of a budget or allocation of resources across units or branches. Our dynamic network DEA model deals with network structure with intermediate products between any sub-DMUs and copes with assignable inputs over observed dynamic periods.
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