Two-stage network structures with undesirable outputs: A DEA based approach

Abstract

The non-parametric Data Envelopment Analysis (DEA) literature on network-structured performance analysis normally considers desirable intermediate measures. These measures are the outputs from the first stage and are used as inputs to the second stage. In many real situations, the intermediate measures consist of desirable and undesirable outputs. This subject has recently attracted considerable attention among DEA researchers. The motivation of this study is the application of the weak disposability to modeling network DEA with undesirable intermediate measures. Undesirable products in this paper are studied in two different cases: either as final outputs or as intermediate measures. In both cases, cooperative and non-cooperative game theories are proposed to assess the relative performance of the operational units. A real case on 39 Spanish Airports in 2008 has been illustrated to verify the applicability of the proposed approaches.