Efficiency and benchmarking in the presence of undesirable (bad) outputs: A DEA approach

 
 
 
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    Environmental assessment recently becomes a major policy issue in the world. This

    study introduces a data envelopment analysis (DEA) model to explore a new use of DEA

    for the environmental assessment in which outputs are classified into desirable (good) and

    undesirable (bad). Such an output separation is important in the DEA-based environmental

    assessment. We used a Range-Adjusted Measure (RAM) DEA model for combining the

    two performance measures operational and environmental performance as a unified measure.

    Reducing the amount of undesirable outputs is the main purpose of environmental

    assessment. Therefor, we try to project the inefficient organization on the efficient frontier

    such that the obtained projection produces fewer undesirable outputs than the evaluated

    organization. To reach this goal, it is not important to increase or decrease the amount of

    inputs.


 

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Article ID: 44
 
DOI: 10.14419/ijamr.v1i2.44




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