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Title: An alternative ranking of DMUs performance for the ZSG-DEA model
Authors: Bouzidis, Thanasis
Karagiannis, Giannis
Type: Article
Subjects: FRASCATI::Social sciences::Economics and Business::Business and Management
FRASCATI::Social sciences::Economics and Business::Economics
Keywords: Data Envelopment Analysis (DEA)
Output interdependency
Fixed-sum output
Zero-Sum Gains (ZSG)
Performance metric
Issue Date: Jun-2022
Source: Socio-Economic Planning Sciences
Volume: 81
First Page: 101179
Abstract: The Zero-Sum Gains Data Envelopment Analysis (ZSG-DEA) model was developed to evaluate the performance of Decision Making Units (DMUs) under output interdependency, which is evident when the total (over DMUs) observed output is a priori fixed. In this paper, we take a closer look at the derivation and interpretation of the ZSG-DEA efficiency scores and we explain why these are not really comparable across DMUs. Moreover, we verify that DMUs' ranking based on their ZSG-DEA efficiency scores is in fact incompatible with output interdependency, which requires total potential output of DMUs to be equal to their total observed output. Then, we propose an alternative metric of DMUs’ performance that is both consistent with output interdependency and comparable across DMUs. This metric is used for classifying DMUs into three (high, average or low performance) groups and for ranking them within these groups. To illustrate its empirical applicability, we use data from the Olympic Games, where output interdependency is clearly evident since the total number of awarded (gold, silver, and bronze) medals is a priori fixed.
ISSN: 0038-0121
Other Identifiers: 10.1016/j.seps.2021.101179
Appears in Collections:Department of Economics

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