Ranking efficient DMUs using cooperative game theory

The problem of ranking Decision Making Units (DMUs) in Data Envelopment Analysis (DEA) has been widely studied in the literature. Some of the proposed approaches use cooperative game theory as a tool to perform the ranking. In this paper, we use the Shapley value of two different cooperative games in which the players are the efficient DMUs and the characteristic function represents the increase in the discriminant power of DEA contributed by each efficient DMU. The idea is that if the efficient DMUs are not included in the modified reference sample then the efficiency score of some inefficient DMUs would be higher. The characteristic function represents, therefore, the change in the efficiency scores of the inefficient DMUs that occurs when a given coalition of efficient units is dropped from the sample. Alternatively, the characteristic function of the cooperative game can be defined as the change in the efficiency scores of the inefficient DMUs that occurs when a given coalition of efficient DMUs are the only efficient DMUs that are included in the sample. Since the two cooperative games proposed are dual games, their corresponding Shapley value coincide and thus lead to the same ranking. The more an ef- ficient DMU impacts the shape of the efficient frontier, the higher the increase in the efficiency scores of the inefficient DMUs its removal brings about and, hence, the higher its contribution to the overall discriminant power of the method. The proposed approach is illustrated on a number of datasets from the literature and compared with existing methods

Productivity Drivers in Japanese Seaports

This paper analyses efficiency drivers of a representative sample of Japanese seaports by means of the two-stage procedure proposed by Simar and Wilson (2007). In the first stage, the technical efficiency of seaports is estimated using several models of data envelopment analysis (DEA) that might be employed in order to establish which of them are most efficient. In the second stage, the Simar and Wilson (2007) procedure is used to bootstrap the DEA scores with a truncated bootstrapped regression to identify efficiency drivers. The policy implications of our findings are considered.Seaports; Japan; Data Envelopment Analysis; Truncated Bootstrapped Regression.

Technical Efficiency of Nigerian Insurance Companies

This paper uses data envelopment analysis (DEA) to evaluate the performance of Nigerian insurance companies, from 2001 to 2005, combining operational and financial variables. The paper also analyses the situations of these companies in relation to the frontier of best practices. In addition, it tests for the roles played by dimension, bank network and market share in the efficiency of the Nigerian insurance companies. The implications of this research for managerial purposes are then drawn.Nigerian insurance companies; Data Envelopment Analysis; Efficiency.

Operational Research in Education

Operational Research (OR) techniques have been applied, from the early stages of the discipline, to a wide variety of issues in education. At the government level, these include questions of what resources should be allocated to education as a whole and how these should be divided amongst the individual sectors of education and the institutions within the sectors. Another pertinent issue concerns the efficient operation of institutions, how to measure it, and whether resource allocation can be used to incentivise efficiency savings. Local governments, as well as being concerned with issues of resource allocation, may also need to make decisions regarding, for example, the creation and location of new institutions or closure of existing ones, as well as the day-to-day logistics of getting pupils to schools. Issues of concern for managers within schools and colleges include allocating the budgets, scheduling lessons and the assignment of students to courses. This survey provides an overview of the diverse problems faced by government, managers and consumers of education, and the OR techniques which have typically been applied in an effort to improve operations and provide solutions

Efficiency in Public Research Centers: Evaluating the Spanish Food Technology Program

We rely on efficiency analysis to evaluate the Spanish R&D public policy based on financial incentives, and investigate to what extent this instrument has been able to promote a multidimensional research output mix, contributing to the articulation of a successful Spanish Food Innovation System. Introducing the use of the generalized distance function within DEA techniques, we assess whether this policy has encouraged the creation, strengthening and promotion of efficient public research units, whose activities present a balanced and comprehensive production of complementary research outputs −personnel training, science and technology results, and socio-economic collaboration with the private sector. Characterizing the alternative ways in which the different research units have been participating in the Spanish Food Technology Program, and hence their role within the innovation system, we conclude that R&D policy efforts have not succeeded in orienting research units toward a balanced output research mix due to wrong incentives and the lack of a sustained budget that would enable the consolidation of emerging research units. Furthermore, we observe that the majority of research units channel their efforts toward achieving science-technology results related to publications and submitted patents, instead of increasing socio-economic results that would strengthen the articulation and efficiency of the innovation system.Innovation System Management; Research Efficiency; Data Envelopment Analysis

Labour Cost Efficiency in UK and Irish Credit Institutions

This paper presents aggregated cost efficiency scores for a balanced panel of British and Irish credit institutions and relates these scores to loan loss reserves as a first step in investigating their usefulness as possible indicators of financial fragility. The efficiency scores are obtained using the two most popular methods of efficiency measurement – data envelopment analysis (DEA) and the stochastic frontiers approach.

A Hybrid Approach to Evaluate the Performance of Engineering Schools

© ASEE 2009Science and engineering (S&E) are two disciplines that are highly receptive to the changes in demand for products and services. These disciplines can either be leading in nature, viz., they create the demand in the market (push) for new products and/or services, or can adopt the changes caused by the varying market conditions (pull). Regardless of the reason, both science and engineering have the responsibility to be compatible with the emerging needs of the market. This fact is also true for the institutions awarding science and engineering degrees. Such higher education institutions also require continuous monitoring and evaluation to be able to remain competitive in the educational arena. Generally, educational institutions are evaluated for their (i) academic affairs, and (2) administrative and financial operations. Academic affairs are monitored by outside authorities such as professional accrediting agencies, State Departments of Higher Education, and the regional accrediting bodies (i.e., NEASC), whereas outcome assessment for administrative and financial operations are handled by the Board of Trustees and the regional accrediting body. In addition, educational institutions also have internal assessment processes conducted to (1) ensure the ability to meet and/or exceed the national educational standards, (2) to be compatible with the mission and vision statements of the organization, and (3) to guarantee the continuous improvement of students, academic and administrative personnel. This internal assessment process embodies a broad spectrum of performance criteria such as curriculum development and revision, contributions to the literature, ethnicity/gender profiles, budget allocation, and student and personnel development. Therefore, several factors that are tangible and intangible in nature have to be considered during internal reviews, thus creating a complex problem environment for the evaluators/decision makers. This being the motivation, this paper proposes a Data Envelopment Analysis (DEA) model to compare each department in the School of Engineering at the University of Bridgeport with each other and with the School. Data and case studies are provided to demonstrate the functionality of the proposed model

The technical efficiency of Public Libraries in the Czech Republic

The purpose of this article is to define and evaluate the development of the aggregated technical efficiency of public libraries in the Czech Republic from 1993 to 2014. To simulate technical efficiency, the Data Envelopment Analysis Model (The BCC model) was chosen. To evaluate the production units (the unit of the Czech Republic from 1993 to 2014 and its production is given by the sum of real homogenous units, i.e. the public libraries operating in a given area and in a given time), two input variables (the recalculated number of employees and the library collection) and two output variables (the number of registered readers and the number of loans) were analysed. Two basic models were simulated – the M1 model oriented to inputs and the M2 model oriented to outputs. Correlation between the input and output variables was researched using Pearson’s coefficient. Within the range of the M1 and M2 basic models, partial models were simulated. All of the basic and partial models identically showed eight efficient periods of public libraries in the Czech Republic (1995, 1997, 1999–2000, 2002–2005). Public libraries were, according to the chosen variables, inefficient in the remaining 16 observed years

Disentangling Within- and Between-Country Efficiency Differences of Bank Branches

In this paper we propose a framework to assess the efficiency of bank branch networks operating in different financial environments. The framework can be used to disentangle within- from between-country performance differences. The framework is constructive in that it identifies operational aspects responsible for superior performance and suggests guidelines for branch improvement. We report results from three bank branch networks in the U.K., Greece and Cyprus, and demonstrate how branch networks can benefit from such international comparisons.Bank Branch Efficiency, International Benchmarks, Data Envelopment Analysis.

Allocating the fixed cost:an approach based on data envelopment analysis and cooperative game

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