Allocating the fixed cost among a set of users in a fair way is an important issue both in management and economic research. Recently, Du et al. (Eur J Oper Res 235(1): 206–214, 2014) proposed a novel approach for allocating the fixed cost based on the game cross-efficiency method by taking the game relations among users in efficiency evaluation. This paper proves that the novel approach of Du et al. (Eur J Oper Res 235(1): 206–214, 2014) is equivalent to the efficiency maximization approach of Li et al. (Omega 41(1): 55–60, 2013), and may exist multiple optimal cost allocation plans. Taking into account the game relations in the allocation process, this paper proposes a cooperative game approach, and uses the nucleolus as a solution to the proposed cooperative game. The proposed approach in this paper is illustrated with a dataset from the prior literature and a real dataset of a steel and iron enterprise in China.
Bibliographical noteThe final publication is available at Springer via http://dx.doi.org/10.1007/s10479-018-2860-9
- Cooperative game
- Data envelopment analysis (DEA)
- Fixed cost allocation
Li, Y., Li, F., Emrouznejad, A., Liang, L., & Xie, Q. (2019). Allocating the fixed cost: an approach based on data envelopment analysis and cooperative game. Annals of Operations Research, 274(1-2), 373–394. https://doi.org/10.1007/s10479-018-2860-9