Estimating returns to scale in imprecise data envelopment analysis

Publikation: Working paperForskning

The economic concept of Returns-to-Scale (RTS) has been intensively studied in the context of Data Envelopment Analysis (DEA). The conventional DEA models that are used for RTS classification require well-defined and accurate data whereas in reality data are often imprecise, vague, uncertain or incomplete. The purpose of this paper is to estimate RTS of Decision Making Units (DMUs) in Imprecise DEA (IDEA) where the input and output data lie within bounded intervals. In the presence of interval data, we introduce six types of RTS involving increasing, decreasing, constant, non-increasing, non-decreasing and variable RTS. The situation for non-increasing (non-decreasing) RTS is then divided into two partitions; constant or decreasing (constant or increasing) RTS using sensitivity analysis. Additionally, the situation for variable RTS is split into three partitions consisting of constant, decreasing and increasing RTS using sensitivity analysis. Finally, we present the stability region of an observation while preserving its current RTS classification using the optimal values of a set of proposed DEA-based models.
OriginalsprogEngelsk
UdgiverDepartment of Food and Resource Economics, University of Copenhagen
Antal sider35
StatusUdgivet - 2014
NavnMSAP Working Paper Series
Nummer07/2014

ID: 127353529