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

Behrouz Arabi, Susila Munisamy, Ali Emrouznejad

Research output: Contribution to journalArticle

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.

Original languageEnglish
Pages (from-to)29-37
Number of pages9
JournalOmega
Volume51
Early online date6 Sep 2014
DOIs
Publication statusPublished - Mar 2015

Fingerprint

Malmquist
Undesirable outputs
Slacks-based measure
Productivity change
Power plant
By-products
Malmquist index
Steam
Production process
Data envelopment analysis

Bibliographical note

© 2014, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/

Keywords

  • data envelopment analysis
  • directional distance function
  • eco-Efficiency change

Cite this

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A new slacks-based measure of Malmquist-Luenberger index in the presence of undesirable outputs. / Arabi, Behrouz; Munisamy, Susila; Emrouznejad, Ali.

In: Omega, Vol. 51, 03.2015, p. 29-37.

Research output: Contribution to journalArticle

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AU - Arabi, Behrouz

AU - Munisamy, Susila

AU - Emrouznejad, Ali

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