Luenberger-Type Indicators Based on the Weighted Additive Distance Function
Posted: 19 Jul 2017
Date Written: July 9, 2017
Abstract
This paper proposes two new Luenberger-type indicators, one for measuring productivity change of decision making units in the full input-output space, and the other one for determining profit inefficiency change over time when information on market prices is also available. Both approaches are based upon the recently introduced Weighted Additive Distance Function (WADF), which permits to endow the well-known Weighted Additive model in Data Envelopment Analysis (DEA) with a structure of distance function. We also show how the two indicators may be decomposed into their drivers.
Keywords: Data Envelopment Analysis, productivity change, profit inefficiency
JEL Classification: C00
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