data envelopment analysis data envelopment analysis

Although DEA models can usually be solved with a standard LP solver, it is recommended to use specifically tailored DEA algorithms for increased accuracy and speed. Such algorithms avoid the computational problems with epsilon and make use of the fact that a unit found to be inefficient can be removed from the basis as it …

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Data Envelopment Analysis is a decision making tool based on linear programming for measuring the relative efficiencies of a set of comparable units. DEA is intitaly developed by Charnes, Cooper, Rhodes (1978).

A hypothetical efficient unit formed from a DMU’s reference units according to the proportions indicated by the dual weights. In Figure , the hypothetical unit for E lies at E’, defined by the reference units B and C.

Named after its developer Chames, Cooper and Rhodes, this is the first and fundamental DEA model, built on the notion of efficiency as defined in the classical engineering ratio. The CCR ratio model calculates an overall efficiency for the unit in which both its pure technical efficiency and scale efficiency are aggregated into a single …

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A factor which can assume only a predefined set of discrete values. Categorical variables are frequently used to indicate the presence or absence of an attribute. An analysis on fast-food restaurants could use a categorical variable assigned to I to indicate the presence of a drive-in window, with the value O denoting its absence. The …

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Generally speaking, the results are biased if they favour a particular unit and/or unfairly assess the efficiency of some inefficient units. Although the actual DEA technique can be considered fair, bias can be introduced into the analysis through the omission of a critical factor or a lack of homogeneity in the field.