Jens Leth Hougaard

Efficiency Evaluations Based on Potential (Non-Proportional) Improvements

Efficiency evaluation of a Decision Making Unit (DMU) involves two issues: 1) selection of an appropriate reference plan against which to evaluate the DMU and 2) measurement of performance slack. In the literature, these issues are mixed in one and the same operation but we argue that it has theoretical as well as practical advantages to separate them. We provide an axiomatic characterization of the implicit Farrell selection. This approach, ignores important aspects of the technology by focussing on proportional variations in inputs (or outputs). We propose a new approach where potential improvements are used to guide the selection of reference plans. A characterization of this approach is provided and an associated translation invariant, strictly monotonous and continuous efficiency index is suggested.

The Chinese Healthcare System: Structure, Problems and Challenges

We describe the structure and present situation of the Chinese healthcare system and discuss its primary problems and challenges. We discuss problems with inefficient burden sharing, adverse provider incentives and huge inequities, and seek explanations in the structural features of the Chinese healthcare system. The current situation will be further challenged in the future by an aging population, an increasing need for privatization and growing expectations about quality of healthcare.

Fuzzy scores of technical efficiency

Abstract This paper suggests to extend scores of technical efficiency as used in, for example, Data Envelopment Analysis (DEA) to efficiency scores defined as so-called fuzzy intervals. Fuzzy scores allow the decision maker to use scores of technical efficiency in combination with other sources of available performance information e.g. expert opinions, key figures etc. In this sense fuzzy scores become formal images of the evaluation otherwise done implicitly by the decision maker and may therefore enhance a more consistent evaluation. It is shown how to rank a set of fuzzy scores.

Railway Reforms: Do They Influence Operating Efficiency?

This paper considers railway operations in 23 European countries during 1995-2001, where a series of reform initiatives were launched by the European Commission, and analyses whether these reform initiatives improved the operating efficiency of the railways. Efficiency is measured using Multi-directional Efficiency Analysis, which enables investigation of how railway reforms affect the inefficiencies of specific cost drivers. The main findings are that the reform initiatives generally improve operating efficiency but potentially differently for different cost drivers. Specifically, the paper provides clear empirical evidence that accounting separation is important for improving operating efficiency for both material and staff costs, whereas other reforms only influenced one of these factor.

An Introduction to Allocation Rules

Motivation and a Few Cases.- Simple Sharing Problems.- Cost Allocation as Cooperative Games.- General Sharing Problems.- Sharing in Networks.

Super Efficiency Evaluations Based on Potential Slack

Super efficiency evaluations are introduced along the lines of the potential improvements approach in Bogetoft and Hougaard (1999). Both a reference selection and a related super efficiency index is defined. The new (potential slack) super efficiency index is compared to a Farrell-based super efficiency index (as in Andersen and Petersen 1993) with respect to convex envelopment technologies.

Measuring Inefficiency Via Potential Improvements

In a recent paper Bogetoft and Hougaard (1999) suggest the use of a new potential improvements approach to efficiency evaluation which has the advantage of separating the issue of benchmark selection from the issue of efficiency measurement. In the present paper the potential improvements inefficiency index is reexamined and a DEA-like approach for its determination is suggested. The approach is called Multi-directional Efficiency Analysis (MEA). An empirical example on Danish dairy farms is used for illustrative purposes and comparisons with various versions of DEA.

On the set of Lorenz-maximal imputations in the core of a balanced game

Abstract. This paper considers the set of Lorenz-maximal imputations in the core of a balanced cooperative game as a solution concept. It is shown that the Lorenz-solution concept satisfies a number of suitable properties such as desirability, continuity and the reduced game property. Moreover, the paper consideres alternative characterizations where it is shown that Lorenz-fairness is tantamount to the existence of an additive, strictly increasing and concave social welfare function. Finally the paper also provides axiomatic characterizations as well as two examples of application.

A simple approximation of productivity scores of fuzzy production plans

This paper suggests a simple approximation procedure for the assessment of productivity scores with respect to fuzzy production plans. The procedure has a clear economic interpretation and all the necessary calculations can be performed in a spreadsheet making it highly operational.

Rationing in the presence of baselines

We analyze a general model of rationing in which agents have baselines, in addition to claims against the (insufficient) endowment of the good to be allocated. Many real-life problems fit this general model (e.g., bankruptcy with prioritized claims, resource allocation in the public health care sector, water distribution in drought periods). We introduce (and characterize) a natural class of allocation methods for this model. Any method within the class is associated with a rule in the standard rationing model, and we show that if the latter obeys some focal properties, the former obeys them too.