Classifying and characterizing efficiencies and inefficiencies in data development analysis

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Abstract

DEA (Data Envelopment Analysis) attempts to identify sources and estimate amounts of inefficiencies contained in the outputs and inputs generated by managed entities called DMUs (=Decision Making Units). Explicit formulation of underlying functional relations with specified parametric forms relating inputs to outputs is not required. An overall (scalar) measure of efficiency is also obtained for each DMU from the observed values of its multiple inputs and outputs without requiring uses of a priori weights. There are many different ways of specifying DEA reference sets. A partition into 6 classes is provided for such observations in which 3 are scale inefficient and 3 are scale efficient with the latter containing substs of DMUs that are also technically (=zero waste) efficient. © 1986.

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Charnes, A., Cooper, W. W., & Thrall, R. M. (1986). Classifying and characterizing efficiencies and inefficiencies in data development analysis. Operations Research Letters, 5(3), 105–110. https://doi.org/10.1016/0167-6377(86)90082-9

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