Article ID: | iaor20003850 |
Country: | Netherlands |
Volume: | 119 |
Issue: | 3 |
Start Page Number: | 652 |
End Page Number: | 661 |
Publication Date: | Dec 1999 |
Journal: | European Journal of Operational Research |
Authors: | Cook Wade D., Kress Moshe |
In many applications to which DEA could be applied, there is often a fixed or common cost which is imposed on all decision making units. This would be the case, for example, for branches of a bank which can be accessed via the numerous automatic teller machines scattered throughout the country. A problem arises as to how this cost can be assigned in an equitable way to the various DMUs. In this paper we propose a DEA approach to obtain this cost allocation which is based on two principles: invariance and pareto-minimality. It is shown that the proposed method is a natural extension of the simple one-dimensional problem to the general multiple-input multiple-output case.