DOMINATING DIRECTIONS  FREE DISPOSABLE HULL

H. Ravi Sankar; C. Subbarami Reddy

Volume : VI, Issue : III, March - 2016

DOMINATING DIRECTIONS FREE DISPOSABLE HULL

H. Ravi Sankar, C. Subbarami Reddy

Abstract :

 Data Envelopment Analysis (DEA) is a linear programming technique, that provides efficiencies for Decision Making Units (DMUs). For inefficient firms it provides virtual DMU’s production plan as bench mark. These bench marks are either linear or convex combinations of more than one relatively extremely efficient DMU. Nonconvex technology based on Free Disposable Hull provides shorter input and output targets in addition to one and only one efficient peer. In this paper to assess input and output oriented efficiency the directional distance function is implemented, and the inefficient production plans are moved in the direction of dominating decision making units. The method is capable of grouping inefficient firms such that for each group there exists one and only one efficient peer.