A new slack DEA model to estimate the impact of slacks on the efficiencies

Abstract

The total potentials for improvement frequently remain unrevealed by calculating radial efficiency measure by basic data envelopment analysis (DEA) models. In this paper, we propose a new slack DEA model which extends the radial measure with the actual impact of slacks on efficiency scores. The new slack model (NSM) deals directly with input and output slacks. The model satisfies monotone decreasing property with respect to slacks. It also satisfies all other properties of radial DEA model, such as unit invariance and translation invariance, in outputs for the input-oriented model. The dual of this model reveals that all multipliers have become positive, i.e. all input and output variables are fully utilised in the performance assessment of the decision-making units. The study describes the characterisation of the NSM theoretically and empirically by numerical example. For this purpose, we measure the efficiency of the 15 regions of Uttar Pradesh State Road Transport Corporation for the year 2004–2005 through new slack DEA model.