Ranking production units according to marginal efficiency contribution
Research output: Working paper › Research
League tables associated with various forms of service activities from schools to hospitals illustrate the public need for ranking institutions by their productive performance. We present a new method for ranking production units which is based on each units marginal contribution to the technical efficiency of various “mergers” relative to a common reference technology. The approach is radically different from the usual one based on super-efficiency indexes in DEA. We illustrate the mechanics of our method by a series of numerical examples and further demonstrate that our new index inherits all relevant and desirable properties of the Farrell efficiency index upon which it is constructed.
Original language | English |
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Publisher | Department of Food and Resource Economics, University of Copenhagen |
Number of pages | 21 |
Publication status | Published - 2014 |
Series | MSAP Working Paper Series |
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Number | 04/2014 |
ID: 123832941