Short Communication
A simplified version of the DEA cost efficiency model

https://doi.org/10.1016/j.ejor.2006.11.043Get rights and content

Abstract

This short paper deals with a current cost efficiency model and decreases the number of its constraints as well as its variables, which leads to a strong reduction in the computational requirements.

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Cited by (35)

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    2019, Expert Systems with Applications
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    We will consider this model even though other models exist (Cooper et al., 2007) as well as more economic compact formulations (Jahanshahloo, Soleimani-damaneh, & Mostafaee, 2008).

  • Cost and revenue efficiency in DEA-R models

    2014, Computers and Industrial Engineering
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    Many studies have dealt with measuring cost efficiency (CE) and revenue efficiency (RE). These include, among others, Ray and Kim (1995), Cooper, Thompson, and Thrall (1996), Schaffnit, Rosen, and Paradi (1997), Sueyoshi (1997), Puig-Junoy (2000), Kuosmanen and Post (2001), Kuosmanen and Post (2003), Tone (2002), Tone and Sahoo (2005), Maniadakis and Thanassoulis (2004), Sengupta and Sahoo (2006), Jahanshahloo, Soleimani-Damaneh, and Mostafaee (2008), Mostafaee and Saljooghi (2010), Sahoo, Kerstens, and Tone (2012), and Sahoo, Mehdiloozad, and Tone (2014). Since DEA efficiency is defined as the ratio of the weighted sum of outputs to the weighted sum of inputs (which leads to the input-oriented CCR model), or vice versa (which leads to the output-oriented CCR model), then the appearance of zero weights in the model, or the imposition of weight restrictions (especially ɛ), might yield an unreal efficiency score.

  • Cost, revenue and profit efficiency measurement in DEA: A directional distance function approach

    2014, European Journal of Operational Research
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    Since then, the aspect of measuring cost and revenue efficiencies has been explored in many studies. See, e.g., Ray and Kim (1995), Cooper, Thompson, and Thrall (1996), Schaffnit, Rosen, and Paradi (1997), Sueyoshi (1997), Puig-Junoy (2000), Kuosmanen and Post (2001), Kuosmanen and Post (2003), Tone (2002), Tone and Sahoo (2005, 2006), Maniadakis and Thanassoulis (2004), Sengupta and Sahoo (2006), Jahanshahloo, Soleimani-Damaneh, and Mostafaee (2008), Mostafaee and Saljooghi (2010), Sahoo, Kerstens, and Tone (2012), among others. Both the CE- and RE-based DEA models developed by Färe et al. (1985) require not only input and output quantity data but also their prices at each firm.

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