COMPONENTS OF EFFICIENCY EVALUATION IN DATA ENVELOPMENT ANALYSIS

This paper examines three essential components which comprise efficiency evaluation in data envelopment analysis. The three components are present in each DEA model and determine the implicit evaluation scheme associated with the model. These components provide a framework for classifying the various DEA models with respect to (i) the form of envelopment surface, (ii) the orientation, and (iii) the pricing mechanism implicit in the multiplier lower bounds. The discussion focuses on the standard DEA models, includes additional issues relating to efficiency evaluation, and is illustrated by a computational example.