BAM: a bounded adjusted measure of efficiency for use with bounded additive models
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A decade ago the Range Adjusted Measure (RAM) was introduced for use with Additive Models. The empirical experience gained since then recommends developing a new measure with similar characteristics but with more discriminatory power. This task is accomplished in this paper by introducing the Bounded Adjusted Measure (BAM) in connection with a new family of Data Envelopment Analysis (DEA) additive models that incorporate lower bounds for inputs and upper bounds for outputs while accepting any returns to scale imposed on the production technology.
KeywordsDEA Additive models Efficiency measures Returns to scale Bounded additive models
JEL ClassificationC51 C61
The authors would like to hereby express their gratitude to the Spanish Ministry of Science and Innovation through grant MTM2009-10479 and to the CIO for financial support. We would also like to thank Dr. Victor Podinovski for his suggestions during the NAPW 2010 meeting.
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