DEA Window Analysis with slack-based measure of Efficiency in Indian Cement Industry
AbstractIn data envelopment analysis (DEA), the concept of efficiency is examined either in radial measure or in non-radial measure. Radial measure gives the proportion or a percentage by which all the inputs (outputs) to be reduced(increased) simultaneously, while as the non-radial measure deals directly with the input output slacks which must be minimized, hence inputs and outputs need not to optimized by same proportion. Radial measures often provide a weak efficiency score while as there is no such case for Non-radial models. The aim of this paper is to employ the non-radial measure(Slack-based model) in DEA window analysis to measure the Technical Efficiency change over years of various Indian cement companies. The research is based on unbalanced panel data of Indian cement companies during the period 2005-15. DEA window analysis is used to determine the efficiency of cement companies and to observe the possibility of changes in the technical efficiency over time. A study is conducted to evaluate the efficiency of cement companies in India in order to identify the sources of inefficiencies and formulate proposals for improving the productivity of those companies and their operations through a three-year window analysis.
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