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Computing the Efficiency of a DMU with Stochastic Inputs and Outputs Using Basic DEA Models

Computing the Efficiency of a DMU with Stochastic Inputs and Outputs Using Basic DEA Models

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Published by ijcsis
This paper tries to introduce essential models of stochastic and deterministic models (DEA) using the Chance Constrained Programming model to measure the DMU, that enter the system simultaneously with the stochastic inputs and outputs. Considering the fact that by adding a Decision Making Unit to the series of DMUs the efficiency frontier may change, the main goal is to change the available essential stochastic models of DEA and compute the amount of efficiency of the DMU and its position in respect to the old frontier. Finally an Example is shown to highlight the procedure of changing the stochastic model to deterministic model.
This paper tries to introduce essential models of stochastic and deterministic models (DEA) using the Chance Constrained Programming model to measure the DMU, that enter the system simultaneously with the stochastic inputs and outputs. Considering the fact that by adding a Decision Making Unit to the series of DMUs the efficiency frontier may change, the main goal is to change the available essential stochastic models of DEA and compute the amount of efficiency of the DMU and its position in respect to the old frontier. Finally an Example is shown to highlight the procedure of changing the stochastic model to deterministic model.

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(IJCSIS) International Journal of Computer Science and Information Security,Vol. 9, No. 5, May 2011
Computing the Efficiency of a
 DMU 
withStochastic Inputs and Outputs Using Basic DEAModels
 M. NabahatSama technical and vocationaltraining school, Islamic Azaduniversity, Urmia branch,Urmia,Iranmehrdad_nabahat@yahoo.comF.Esmaeeli sangariSama technical and vocationaltraining school, Islamic Azaduniversity, Urmia branch,Urmia,Iranfardin_e_s@yahoo.com S.M.MansourfarSama technical and vocationaltraining school, Islamic Azaduniversity, Sahand branch, Sahand,Iranmostafa.mansourfar@gmail.com
 Abstract-
This paper tries to introduce essential models of stochastic and deterministic models (DEA) using the ChanceConstrained Programming model to measure the DMU, thatenter the system simultaneously with the stochastic inputs andoutputs. Considering the fact that by adding a Decision MakingUnit to the series of DMUs the efficiency frontier may change, themain goal is to change the available essential stochastic models of DEA and compute the amount of efficiency of the DMU and itsposition in respect to the old frontier.Finally an Example is shown to highlight the procedure of changing the stochastic model to deterministic model
.
 Keywords
-DEA; Stochastic Programming; Efficiency; frontier
1. Introduction
Stochastic programming is a framework of modelingoptimization problems that involve uncertainty. Whereasdeterministic optimization problems are formulated withknown parameters, real world problems almost invariablyinclude some unknown parameters. Stochastic programmingmodels are similar in style but take advantage of the fact thatprobability distributions governing the data are known or canbe estimated.This branch of science has been used since the late 1950s fordecision models where input data (coefficients in Lp problem)have been given probability distribution. Without any attemptat completeness, we might mention from the earlycontributions to this field. The pioneer works were done byDantzing[1-2], Beale[3-4], Tintner[5], Simon, Charnes,Cooper[6-7], Avriel and Williams [8] and Since then ,a number of Stochastic programming models have been formulated ininventory theory, system maintenance ,micro-economics,banking and finance.Among various stochastic models, we would like to introducethe chance constrained programming, and we will use it in oneof the essential models.In this paper new DMU with stochastic inputs and outputs isadded to the set of observed DMUs then information aboutefficiency of this DMU and changes in frontier of productionpossibility set of observed DMUs are interested.
2. Preliminaries
 
Consider a set of homogenous
 DMUs
as
n j DMU 
 j
,,2,1
.
Each
 DMU 
Consumes
m
 inputs to produce
S
outputs. Suppose that
mj j j
x x X 
,
1
and
sj j j
y y
,
,1
are thevectors of inputs and outputs values for
 j
 DMU 
.Respectively let
0&0
j j
 X 
and
0&0
j j
.By using 0-1 parameters
21
,
  
and
3
 
, the productionpossibility sets can be written into its generalized form [9],
1,...,1,0,))1(( ,0,).(
11321111
n j y y x x  y x
 jnn j jn j j jn j j j
         
 
 The following four different production possibility sets areobtained by assigning different values to
),,(
321
   
:(i) If 
1,0&1,0&0
321
 
   
, then
becomes the production possibility set for the
CCR
 model.
n jn j j j j j jCCR
n j y y x x y x
1 1
},...,1,0,0,|),{(
   
 (ii) If 
&0&1
21
  
,
1,0
3
 
 
then
becomes the production possibility set for the
 BCC 
 model.
n jn j jn j j j j j j BCC 
n j y y x x y x
1 1 1
},...1,0,1,0,|),{(
    
 
200http://sites.google.com/site/ijcsis/ISSN 1947-5500
 
(IJCSIS) International Journal of Computer Science and Information Security,Vol. 9, No. 5, May 2011
Theorem 1. (Bon ferroni inequality):
If the set of arbitrary events
 
n
 A A A
,,
21
constitutes apartition of the sample space
 
S
and
 
cncc
 A A A
,,,
21
arecomplements of events
n
 A A A
,,
21
the following ruleapply:
)1()(1)(
11
niicini
 AP AP
 
3. Adding Competitive
 DMU 
to the Basic DEA Models
In this section, we will introduce two basic models of DEAwith special condition, new DMU with stochastic inputs andoutputs is added to the set of observed DMUs theninformation about efficiency of this DMU and changes infrontier of production possibility set of observed DMUs areinterested. Suppose
1
n
 DMU 
with Stochastic inputs andoutputs enter the previous comparative
 DMU 
system .Wewant to achieve results regarding the efficiency of 
1
n
 DMU 
and impact of the amount of deterministic inputsand outputs on the old PPS frontier.A Chance Constrained Programming model for CCR modelwith the assumption that
o
 DMU 
with a stochastic inputsand outputs enters the system is defined as the following:Where
oo
 X 
and
are all random variables and
P
 degree of probability and follow from each constraint beingrealized with a minimum probability of 
101
  
.For illustrative purpose, let us assume
oo
 X 
and
arenormally distributed with known means and variances. Thuswe have the following chance constrained programmingproblem
n jsmi y y x xPs  Min
 jron jrj jion jij j
,,2,1,0 ,,1,,11,.
11
    
       
 Suppose:Following the theorem 1:
n jn jrorj jioij j cismi
y y x xP AP
1 11
1),()(
    
(2)From (1) and (2) we have:
smism AP AP AP AP
icismismiicismi
,,1)( 1)()(1)(
111
  
 We have introduced
o
 DMU 
with normally distributed, itmeans:
smi  N  y N  x
roiiio
,...1,,...1 ),(~,),(~
22
    
 Then it can be written:
)4(,...,1)()( )3(,...,1)()(
11
ssm y yP AP mism x xP AP
ron jrj jm ion jij ji
     
 By (3):
)5()( ,....,1
11
sm x xPmism x x xP
ioono j jij jioioono j jij j
        
        
 
n j X Ps  Min
 jcoo
,,2,1,0 1),(.
    
s y y A mi x x A
ron jrj jm ion jij ji
,,1,,1
11
   
201http://sites.google.com/site/ijcsis/ISSN 1947-5500
 
(IJCSIS) International Journal of Computer Science and Information Security,Vol. 9, No. 5, May 2011
It is known that
)1,0(~Then),(~if 
2
 N  X  N  X 
      
 From (5) we have:
)6()()()( )()(
1
sm x xP
 Z oioioio  zoino j joiij j
    
                 
            
 Let
 
represented the cumulative distribution function (CDF)of the standard normal distribution and suppose
sm
 
be thestandard normal value such that
sm
sm
  
 
1)(
thenfrom (6):
)(1)()(
1
smoioino j jij j
sm x
    
 
           
 Finally:
smsm oioino j jij j
 x
  
       
1)()(
1
 
)7()1()1(
1
smiismiiono j jij j
 x
  
       
 Same process can be considered for (4)Then the deterministic form of this model is:
n j y xs  Min
 jsmsmono j jrj jsmiismiiono j jij j
,,2,1,0 )8()]1([)]1([ )]1([)]1([.
11
                 
    
 Deterministic form of BCC model for measuring theefficiency of 
o
 DMU 
is
:
 
n j y xs  Min
 jn jjsmsmono j jrj jsmiismiiono j jij j
,,2,1,0,1 )9()]1([)]1([ )]1([)]1([.
111
                  
    
 
The determination of the interval where
sm
 
ischangeable.By
n j x X  y
 j j
,...,10,0,0,0
, wehave:
).10(10)(0)1( ).10(1)(0)1(
b a
smsm smiismsm iiismii
               
      
 And by
11010
  
:
).10() 11(11)(1111101
1
csmsmsmsmsmsm
smsm
      
  
 
By (10.a), (10, b), (10.c),
sm
 
is obtained.
4. Numerical example
In this section ,we work out a numerical example to illustratethe efficiency of competing DMU with stochastic inputs andoutputs that enter our system and suppose the inputs andoutputs are normally distributed with known means andvariances(given by Decision-maker) deterministic model andits efficiency are interested .Example: Consider the four DMUs with single inputs andsingle outputs as defined inTable 1:
Table 1Data set for the numerical example
DMU A B C D EInput 2 5 2 7
)4,2(~
 x
 E 
 Output 4 8 2 8
)9,8(~
 y
 E 
 
202http://sites.google.com/site/ijcsis/ISSN 1947-5500

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