Forecast of the efficiency confidence interval of decision-making units in data envelopment analysis

Authors

  • Azarnoosh Kafi Department of Mathematics, Lahijan Branch, Islamic Azad University, Lahijan, Iran
  • Behrouz Daneshian Department of Mathematics, Central Tehran Branch, Islamic Azad University, Tehran, Iran
  • Mohsen Rostamy-Malkhalifeh Department of Mathematics, Science and Research Branch, Islamic Azad University, Tehran, Iran
  • Mohsen Rostamy-Malkhalifeh Department of Mathematics, Science and Research Branch, Islamic Azad University, Tehran, Iran

DOI:

https://doi.org/10.5377/nexo.v33i02.10782

Keywords:

Data Envelopment Analysis, Forecast, Time Series, Probability Programming, Efficiency, Monte Carlo Simulation, Confidence Interval

Abstract

Data Envelopment Analysis (DEA) is a well-known method for calculating the efficiency of Decision-Making Units (DMUs) based on their inputs and outputs. When the data is known and in the form of an interval in a given time period, this method can calculate the efficiency interval. Unfortunately, DEA is not capable of forecasting and estimating the efficiency confidence interval of the units in the future. This article, proposes a efficiency forecasting algorithm along with 95% confidence interval to generate interval data set for the next time period. What’s more, the manager’s opinion inserts and plays its role in the proposed forecasting model. Equipped with forecasted data set and with respect to data set from previous periods, the efficiency for the future period can be forecasted. This is done by proposing a proposed model and solving it by the confidence interval method. The proposed method is then implemented on the data of an automotive industry and, it is compared with the Monte Carlo simulation methods and the interval model. Using the results, it is shown that the proposed method works better to forecast the efficiency confidence interval. Finally, the efficiency and confidence interval of 95% is calculated for the upcoming period using the proposed model.

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Published

2020-12-31

How to Cite

Kafi, A., Daneshian, B., Rostamy-Malkhalifeh, M., & Rostamy-Malkhalifeh, M. (2020). Forecast of the efficiency confidence interval of decision-making units in data envelopment analysis. Nexo Scientific Journal, 33(02), 431–445. https://doi.org/10.5377/nexo.v33i02.10782

Issue

Vol. 33 No. 02 (2020)

Section

Articles

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