A new slacks-based measure of Malmquist-Luenberger index in the presence of undesirable outputs

Arabi, Behrouz; Munisamy, Susila and Emrouznejad, Ali (2015). A new slacks-based measure of Malmquist-Luenberger index in the presence of undesirable outputs. Omega, 51 , pp. 29-37.

Abstract

In the majority of production processes, noticeable amounts of bad byproducts or bad outputs are produced. The negative effects of the bad outputs on efficiency cannot be handled by the standard Malmquist index to measure productivity change over time. Toward this end, the Malmquist-Luenberger index (MLI) has been introduced, when undesirable outputs are present. In this paper, we introduce a Data Envelopment Analysis (DEA) model as well as an algorithm, which can successfully eliminate a common infeasibility problem encountered in MLI mixed period problems. This model incorporates the best endogenous direction amongst all other possible directions to increase desirable output and decrease the undesirable outputs at the same time. A simple example used to illustrate the new algorithm and a real application of steam power plants is used to show the applicability of the proposed model.

Divisions: Aston Business School > Operations & information management
Additional Information: © 2014, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/
Uncontrolled Keywords: data envelopment analysis,directional distance function,eco-Efficiency change,Strategy and Management,Information Systems and Management,Management Science and Operations Research
Published Date: 2015-03

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