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Estimating Returns to Scale in Imprecise Data Envelopment Analysis

Author

Listed:
  • Adel Hatami-Marbini

    (Louvain School of Management, Universite Catholique de Louvain)

  • Zahra Ghelej Beigi

    (Department of Mathematics, Islamic Azad University)

  • Jens Leth Hougaard

    (Department of Food and Resource Economics, University of Copenhagen)

  • Kobra Gholami

    (Department of Science, Islamic Azad University)

Abstract
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.

Suggested Citation

  • Adel Hatami-Marbini & Zahra Ghelej Beigi & Jens Leth Hougaard & Kobra Gholami, 2014. "Estimating Returns to Scale in Imprecise Data Envelopment Analysis," MSAP Working Paper Series 07_2014, University of Copenhagen, Department of Food and Resource Economics.
    • Handle: RePEc:foi:msapwp:07_2014
    as

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    File URL: http://okonomi.foi.dk/workingpapers/MSAPpdf/MSAP2014/MSAP_WP07_2014.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Returns-to-scale; Interval data; Data envelopment analysis;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General

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