Programmatic efficiency comparisons between unequally sized groups of DMUs in DEA

Abstract

Data envelopment analysis (DEA) is a popular non-parametric technique for determining the efficiency of a homogeneous set of decision-making units (DMUs). In many practical cases, there is some doubt if the all the DMUs form a single group with a common efficiency distribution. The Mann-Whitney rank statistic has been used in DEA both to test if two groups of DMUs come from a common efficiency distribution and also to test if the two groups have a common frontier, each of which are likely to have important but different policy implications for the management of the groups. In this paper it is demonstrated that where the Mann-Whitney rank statistic is used for the second of these it is likely to overestimate programmatic inefficiency, particularly of the smaller group. A new non-parametric statistic is proposed for the case of comparing the efficient frontiers of two groups, which overcomes the problems we identify in the use of the Mann-Whitney rank statistic for this purpose. © 2005 Operational Research Society Ltd. All rights reserved.

Publication DOI: https://doi.org/10.1057/palgrave.jors.2601961
Divisions: Aston Business School > Operations & Information Management
Aston Business School
Additional Information: This is a post-peer-review, pre-copyedit version of an article published in Journal of the Operational Research Society. The definitive publisher-authenticated version Simpson, Gary P.M. (2005). Programmatic efficiency comparisons between unequally sized groups of DMUs in DEA. Journal of the Operational Research Society, 56 (12), pp. 1431-1438, is available online at: http://www.palgrave-journals.com/jors/journal/v56/n12/full/2601961a.html
Uncontrolled Keywords: data envelopment analysis,statistics,Management of Technology and Innovation,Strategy and Management,Management Science and Operations Research
Full Text Link:
Related URLs: http://www.scop ... tnerID=8YFLogxK (Scopus URL)
http://www.palg ... l/2601961a.html (Publisher URL)
PURE Output Type: Article
Published Date: 2005-12
Authors: Simpson, G.

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