Sensitivity analysis on modified variable returns to scale model in Data Envelopment Analysis using facet analysis

Abstract

One of the concerns in Data Envelopment Analysis (DEA) is the sensitivity and stability analysis of specific Decision Making Unit (DMU), which is under evaluation. In economical point of view, the stability region in input-output space for maintaining the efficiency score of efficient DMU is important. In this paper, a new sensitivity analysis approach based on Banker, Charnes and Cooper (BCC) model which is modified by facet analysis, is developed. An extended stability region is determined especially for DMUs that are placed on intersection of efficient and weak efficient frontier. The results are shown by numerical examples. (C) 2014 Elsevier Ltd. All rights reserved.