Basic Ideas in Efficiency Measurement for Network Systems
In measuring the efficiency of a DMU one can consider it as a closed plant, and the evaluator stands outside of the plant counting the quantity of materials and number of workers entering to manufacture products. After a period of time, the evaluator counts the quantity of products sent out of the plant. From the inputs consumed and the outputs produced, the evaluator is able to measure the relative efficiency of this plant compared to other similar plants via the conventional DEA technique. The plant in this case is treated as a black box, in that how the materials are converted into outputs inside the plant is not known.
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