Effect of uncontrollable factors on constant returns-to-scale production technologies

Subject Areas : International Journal of Data Envelopment Analysis

Reza Shahverdi ¹ , Azam Ahmadzadeh ²

1 - Department of Mathematics, Qaemshahr Branch, Islamic Azad University, Qaemshahr, Iran
2 - Department of Mathematics,Sari Branch, Islamic Azad University Sari, Iran

Received: 2017-06-06 Accepted : 2017-06-06 Published : 2016-11-01

Keywords: Uncontrollable factors, Controllable factors, Returns to scale, Data Envelopment Analysis,

Abstract :

This article discusses the effect of uncontrollable factors on constant returns-to-scale production technologies in data envelopment analysis(DEA). First we show that the Banker and Morey CRS technology is not convex and it is nevertheless a suitable reference technology for the assessment of scale efficiency and achieves model by the incorporation of variant inputs and outputs in data envelopment analysis. Second, we propose that if changes axiom returns to scale of production possibility set, model will secure variant another model with uncontrollable factors. Therefore returns to scale properties very depending on the manner in which uncontrollable factors are treated and approaches can be compared both theoretically and empirically.

References:

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[2] Banker, R.D.,(1984). Estimating most productive scale size using data envelopment analysis. European Journal of Operational Research 17, 35-44.

[3] Banker, R.D., Morey, R.C., (1986). Efficiency analysis for exogenously fixed inputs and outputs. Operations Research 34, 513-521.