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Category: Frequently Asked Question

Scale efficiency

A unit is said to be scale efficient when its size of operations is optimal so that any modifications on its size will render the unit less efficient. The value for scale efficiency is obtained by dividing the aggregate efficiency by the technical efficiency.


The additional improvement (increase in outputs and/or decrease in inputs) needed for a unit to become efficient.

Unit isoquant/Isoquant

Yet another name for the efficiency frontier, this term emphasises the fact that each segment of the frontier represents the trade-off possibilities that can be made between the inputs or outputs of a given DMU on the isoquant segment while keeping the DMU efficient.


For a single input-output case, the ratio of a unit’s output to its input. Productivity varies according to changes that occur in the production technology, the efficiency of the production process (which can be measured through DEA) and the production environment (Lovell 1993). [Lovel C A K (1993), ‘Productive frontiers and productive efficiency’, in: Fried …

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Production function

Given a set of inputs that produce outputs, the production function defines an optimum relationship for producing the maximal amount of output from the given inputs. The DEA equivalent of the production function is the efficiency frontier which is based on empirical data (inputs and outputs). See Chames et al (1981) for details and more …

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Projected point

Refers to an inefficient DMU’s composite unit to emphasise that geometrically it involves the projection of the inefficient DMU onto the efficiency frontier (Ali and Seiford 1993). [Ali A and Seiford L (1993), ‘The mathematical programming approach to efficiency analysis’, in: Fried H, Knox C A K and Schmidt S (editors), The measurement of productive …

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Virtual multipliers

Another name for weights


A factor which describes the amount of goods, services or other outcome obtained as a result of the processing of resources. Also, any factor which describes the qualitative nature of the resulting outcome.

Overall efficiency

Same as aggregate efficiency


Short for decision making unit or DMU.

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