Article ID: | iaor20116890 |
Volume: | 186 |
Issue: | 1 |
Start Page Number: | 357 |
End Page Number: | 381 |
Publication Date: | Jun 2011 |
Journal: | Annals of Operations Research |
Authors: | Wu Dash, Zhou Zhaoxin, Birge R |
Keywords: | statistics: data envelopment analysis |
A new dynamic Data Envelopment Analysis (DEA) approach is created to provide valuable managerial insights when assessing the merger performance. This new approach allows us to dynamically evaluate the pre‐merger firms and the post‐merger firm in a multi‐period situation. A case study of bank branch merger is conducted to illustrate and validate the proposed approach. Both stochastic frontier analysis and data envelopment analysis are used and compared leading to highly correlated results. The computation show that merger results in an overall efficiency achievement in a banking industry.