Robustness analysis based on weight restrictions in data envelopment analysis

Includes bibliographical references.Evaluating the performance of organisations is essential to good planning and control. Part of this process is monitoring the performance of organisations against their goals. The comparative efficiency of organizations using common inputs and outputs makes it possible for organizations to improve their performance so that can operate as the most efficient organizations. Resources and outputs can be very diversified in nature and it is complex to assess organizations using such resources and outputs. Data Envelopment Analysis models are designed to facilitate this of assessment and aim to evaluate the relative efficiency of organisations. Chapter 2 is dedicated to the basic Data Envelopment Analysis. We present the following: * A review of the Data Envelopment Analysis models; * The properties and particularities of each model. In chapter 3, we present our literature survey on restrictions. Data Envelopment Analysis is a value-free frontier which has the of yielding more objective efficiency measures. However, the complete freedom in the determination of weights for the factors and products) relevant to the assessment of organisations has led to some problems such as: zero-weights and lack of discrimination between efficient organizations. Weight restriction methods were introduced in order to tackle these problems. The first part of chapter 3 in detail the motivations for weight restrictions while the second part presents the actual weight restriction rnethods

Evaluating Data Envelopment Analysis as a means of measuring van fuel efficiency

In order to improve fuel efficiency, fleet managers need methods to accurately measure fuel performance. Miles per gallon – the industry fuel efficiency standard measure – has several limitations. These relate to some aspects of fuel efficiency not reflected in the measure but also to the fact the measure cannot be interpreted without knowing some external factors (such as vehicle weight). This research addresses some of these limitations through the application – within three companies – of a Data Envelopment Analysis (DEA) model to van fuel efficiency measurement. In order to use the fuel information obtained from the fuel cards statements, it was necessary to develop a cleansing and smoothing algorithm which ensured that the data could be safely used in the models. The model results indicate that DEA provided a better and more comparable fuel efficiency measure while effectively addressing some key limitations of the mpg measure. The originality of this research comes from the limited amount of published literature on fuel efficiency measurement in road transport operations. Effectively, only a limited number of papers can be found on the measurement of road operations efficiency using DEA and, with the exception of this study, none could be found on van operations or fuel efficiency measurement. Debriefing discussions confirmed that the fleet operators appreciated the measure and also suggested that more research on fuel theft could be useful. Finally, the recent success of driver competitions seems to indicate there is a latent need in the industry for accurate driver performance measurement, which suggests that methods such as the one developed in this study could be of greater use in the near future.EThOS - Electronic Theses Online ServiceGBUnited Kingdo

Bootstrapping in Network Data Envelopment Analysis

Data Envelopment Analysis (DEA) is a linear-programming method used to measure the relative efficiency of firms. The objective of this thesis is (i) to study the efficiency of the railway transport process in Europe considering its inner structure and the impact of railway noise on humans and (ii) to study the performance of bootstrapping approaches in obtaining DEA efficiency estimates when the production process has a network structure and the relation between the different stages is considered. First, the railway transport process is divided into two stages, related to assets and service provision, respectively. The negative impact of railways on people is measured as the number of people that are exposed to high levels of railway noise. The number of rail wagons in each country that is retrofitted with more silent braking technology is used as a proxy to measure the effort to reduce railway noise pollution. Data is extracted from Eurostat (2016), ERA 006REC1072 Impact Assessment (2018), and EEA (2020) and the additive efficiency decomposition approach is used. Based on the results, asset-efficient countries are usually service-efficient, but the inverse does not hold. Sensitivity analysis revealed that efficiency rankings are robust to alterations in the decomposition weight restrictions. Subsampling bootstrap was chosen as the most appropriate as it does not require any restrictive assumptions. The performance of subsampling is examined through Monte Carlo simulations for various sample and subsample sizes for general two-stage series structures. Results indicate great sensitivity both to the sample and subsample size, as well as to the data generating process-higher than in one-stage structures. A practical approach is suggested to overcome some result inconsistencies that are due to the peculiarities of the additive decomposition algorithm. The method is applied to obtain confidence interval estimates for the overall and stage efficiency scores of European railways

Benchmarking the performance of UK electricity distribution network operators: a study of quality, efficiency and productivity using data envelopment analysis

The aim of this thesis is twofold. The first is to develop a comprehensive methodology for assessing performance and then to apply it to the UK electricity distribution network operators (DNOs) to analyse the impact of the regulatory reforms and privatisation introduced in 1990-91 on their quality, efficiency and productivity developments. The models and methods developed will not only be useful in the electricity distribution context but also to other organisations that need to assess and monitor both their efficiency and quality. These objectives are realised through the use of the Data Envelopment Analysis (DEA) method, the main subject area of this thesis. This method has recently become very popular in the empirical literature due to the minimal assumptions underlying it, the case of handling multiple inputs and outputs, and its usefulness in the measurement of productivity. Performance measurement needs to keep pace with the changes in the industry. With the developments in energy and regulatory policy, and the enactment of the Utilities Act 2000, the focus of regulation has broadened from a narrow economic focus towards a wider one of protecting the interests of consumers. The latter includes not only price but also quality of service. Given this broadening focus, it is essential that performance measurement takes into account these aspects. This thesis incorporates new dimensions into efficiency and productivity measurement of electricity distribution network operators by taking into account the quality characteristics of electricity distribution operations. The dimensions of quality of service in electricity distribution were defined in this study, namely the quality of supply dimension and the quality of customer service dimension. Plausible measures of service quality were suggested. In order to provide a more balanced performance assessment, the new DEA model that incorporates the quantity as well as the quality of the services that distribution network operators provide their customers was used. In this study, only the quality of supply dimension was used in the analysis. (The quality of customer service dimension was omitted due to lack of data). Besides this, in order to achieve a more comprehensive assessment, both the operating and capital costs of distribution operations were included as inputs. The technological realities of the electricity distribution production process were captured in this study by taking into account the production trade-offs that exist between inputs and outputs. When trade-offs occur, the reduction in one factor can lead to increases in another, thereby reducing the overall reduction. The reflection of production trade-offs provides more reliable results than can be utilised in management and policy making. The production trade-offs were accounted by developing an enhanced DEA model using weight restrictions that are constructed on the basis of production trade-offs. The enhanced DEA model thus was referred to as the ‘weight-restricted’ model. This model developed was used to evaluate the DNOs efficiencies in 1999/00. A new productivity index called the ‘weight-restricted’ Malmquist productivity index was also developed in order to evaluate the quality and productivity changes of the DNOs since 1990/91. This new index is similar in spirit to the Malmquist productivity index but it reflects production trade-offs and service quality rather than just quantities per se. In this regard, the index is more appropriate to evaluate the DNOs. The index was decomposed in this study into its root components of efficiency change and technological change

Composite indicators in energy and environmental modeling

Ph.DDOCTOR OF PHILOSOPH

Benchmarking the performance of UK electricity distribution network operators : a study of quality, efficiency and productivity using data envelopment analysis

The aim of this thesis is twofold. The first is to develop a comprehensive methodology for assessing performance and then to apply it to the UK electricity distribution network operators (DNOs) to analyse the impact of the regulatory reforms and privatisation introduced in 1990-91 on their quality, efficiency and productivity developments. The models and methods developed will not only be useful in the electricity distribution context but also to other organisations that need to assess and monitor both their efficiency and quality. These objectives are realised through the use of the Data Envelopment Analysis (DEA) method, the main subject area of this thesis. This method has recently become very popular in the empirical literature due to the minimal assumptions underlying it, the case of handling multiple inputs and outputs, and its usefulness in the measurement of productivity. Performance measurement needs to keep pace with the changes in the industry. With the developments in energy and regulatory policy, and the enactment of the Utilities Act 2000, the focus of regulation has broadened from a narrow economic focus towards a wider one of protecting the interests of consumers. The latter includes not only price but also quality of service. Given this broadening focus, it is essential that performance measurement takes into account these aspects. This thesis incorporates new dimensions into efficiency and productivity measurement of electricity distribution network operators by taking into account the quality characteristics of electricity distribution operations. The dimensions of quality of service in electricity distribution were defined in this study, namely the quality of supply dimension and the quality of customer service dimension. Plausible measures of service quality were suggested. In order to provide a more balanced performance assessment, the new DEA model that incorporates the quantity as well as the quality of the services that distribution network operators provide their customers was used. In this study, only the quality of supply dimension was used in the analysis. (The quality of customer service dimension was omitted due to lack of data). Besides this, in order to achieve a more comprehensive assessment, both the operating and capital costs of distribution operations were included as inputs. The technological realities of the electricity distribution production process were captured in this study by taking into account the production trade-offs that exist between inputs and outputs. When trade-offs occur, the reduction in one factor can lead to increases in another, thereby reducing the overall reduction. The reflection of production trade-offs provides more reliable results than can be utilised in management and policy making. The production trade-offs were accounted by developing an enhanced DEA model using weight restrictions that are constructed on the basis of production trade-offs. The enhanced DEA model thus was referred to as the ‘weight-restricted’ model. This model developed was used to evaluate the DNOs efficiencies in 1999/00. A new productivity index called the ‘weight-restricted’ Malmquist productivity index was also developed in order to evaluate the quality and productivity changes of the DNOs since 1990/91. This new index is similar in spirit to the Malmquist productivity index but it reflects production trade-offs and service quality rather than just quantities per se. In this regard, the index is more appropriate to evaluate the DNOs. The index was decomposed in this study into its root components of efficiency change and technological change.EThOS - Electronic Theses Online ServiceAssociation of Commonwealth Universities (ACU)GBUnited Kingdo

Using data envelopment analysis for the efficiency and elasticity evaluation of agricultural farms

Data Envelopment Analysis (DEA) is a well-established relative efficiency measurement technique, which has been widely applied to evaluate the technical efficiency of agricultural units in different countries by focusing on different aspects of agricultural production. This research deals with the evaluation of efficiency through DEA in non-homogeneous agricultural production, where units produce a wide range of different outputs. The objectives are threefold. Firstly, we propose a novel methodological approach of integrating the production trade-offs concept of DEA into non-homogeneous agricultural efficiency evaluation to prevent the overstatement of the efficiency of specialist farms and overcome the issue of insufficient discrimination due to large number of outputs in the models. Secondly, we aim to integrate this methodological perspective to the theory of elasticity measurement on DEA frontiers. The efficient frontiers of DEA are not defined in functional forms as in the classical economic theory, therefore obtaining elasticity measures on them require different considerations. We introduce the production trade-offs to the elasticity measurement and derive the necessary models to calculate the elasticities of response in the presence of production trade-offs. As a third objective, before moving to the introduction of the trade-offs in elasticity measurement, for theoretical completeness, we first consider the elasticity measurement on DEA frontiers of constant returns-to-scale (CRS) technologies. Our proposed methodology and all the developed elasticity theory are illustrated in a real world case of Turkish agricultural sectors. We provide extensive empirical applications covering all the proposed theory and methodology. Among the results of this research, we provide an elasticity measurement framework, which enables us to calculate elasticities of response measures in both VRS and CRS technologies, with or without production tradeoffs included. We observe that the integration of production trade-offs provide better discrimination of efficiency scores compared to the models without trade-offs included. We also investigate how changing production trade-offs affect the efficiency and elasticity measures of the evaluated units

Essays on the measurement of school efficiency

Measuring school efficiency is a challenging task. First, a performance measurement technique has to be selected. Within Data Envelopment Analysis (DEA), one such technique, alternative models have been developed in order to deal with environmental variables. The majority of these models lead to diverging results. Second, the choice of input and output variables to be included in the efficiency analysis is often dictated by data availability. The choice of the variables remains an issue even when data is available. As a result, the choice of technique, model and variables is probably, and ultimately, a political judgement. Multi-criteria decision analysis methods can help the decision makers to select the most suitable model. The number of selection criteria should remain parsimonious and not be oriented towards the results of the models in order to avoid opportunistic behaviour. The selection criteria should also be backed by the literature or by an expert group. Once the most suitable model is identified, the principle of permanence of methods should be applied in order to avoid a change of practices over time. Within DEA, the two-stage model developed by Ray (1991) is the most convincing model which allows for an environmental adjustment. In this model, an efficiency analysis is conducted with DEA followed by an econometric analysis to explain the efficiency scores. An environmental variable of particular interest, tested in this thesis, consists of the fact that operations are held, for certain schools, on multiple sites. Results show that the fact of being located on more than one site has a negative influence on efficiency. A likely way to solve this negative influence would consist of improving the use of ICT in school management and teaching. Planning new schools should also consider the advantages of being located on a unique site, which allows reaching a critical size in terms of pupils and teachers. The fact that underprivileged pupils perform worse than privileged pupils has been public knowledge since Coleman et al. (1966). As a result, underprivileged pupils have a negative influence on school efficiency. This is confirmed by this thesis for the first time in Switzerland. Several countries have developed priority education policies in order to compensate for the negative impact of disadvantaged socioeconomic status on school performance. These policies have failed. As a result, other actions need to be taken. In order to define these actions, one has to identify the social-class differences which explain why disadvantaged children underperform. Childrearing and literary practices, health characteristics, housing stability and economic security influence pupil achievement. Rather than allocating more resources to schools, policymakers should therefore focus on related social policies. For instance, they could define pre-school, family, health, housing and benefits policies in order to improve the conditions for disadvantaged children

Evaluation and Design of Supply Chain Operations using DEA

Performance evaluation has been one of the most critical components in management. As production systems nowadays consist of a growing number of integrated and interacting processes, the interrelationship and dynamic among processes have create a major challenge in measuring system and process performance. Meanwhile, rapid information obsolescence has become a commonplace in today’s high-velocity environment. Managers therefore need to make process design decisions based on incomplete information regarding the future market. This thesis studies the above problems in the evaluation and design of complex production systems. Based on the widely used Data Envelopment Analysis models, we develop a generalized methodology to evaluate the dynamic efficiency of production networks. Our method evaluates both the supply network and its constituent firms in a systematic way. The evaluation result can help identify inefficiency in the network, which is important information for improving the network performance. Part II of the thesis covers multi-criteria process design methods developed for situations of different information availability. Our design approaches combine interdisciplinary techniques to facilitate efficient decision-making in situations with limited information and high uncertainty. As an illustration, we apply these approaches to project selection and resource allocation problems in a supply chain