Determination of weights for ultimate cross efficiency using Shannon entropy

Authors:
Jie Wu;Jiasen Sun;Liang Liang;Yingchun Zha
Affiliations:
School of Management, University of Science and Technology of China, Anhui Province, Jinzhai Road, Hefei 230026, PR China;School of Management, University of Science and Technology of China, Anhui Province, Jinzhai Road, Hefei 230026, PR China;School of Management, University of Science and Technology of China, Anhui Province, Jinzhai Road, Hefei 230026, PR China;School of Business, Anhui University, Anhui Province, Feixi Road, Hefei 230039, PR China
Venue:
Expert Systems with Applications: An International Journal
Year:
2011

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Abstract

This paper firstly reviews the cross efficiency evaluation method which is an extension tool of data envelopment analysis (DEA), then we describe the main shortcomings when the ultimate average cross efficiency scores are used to evaluate and rank the decision making units (DMUs). In this paper, we eliminate the assumption of average and utilize the Shannon entropy to determine the weights for ultimate cross efficiency scores, and the procedures are introduced in detail. In the end, an empirical example is illustrated to examine the validity of the proposed method. Some future research directions are also pointed out.