Network Russell-based measure with undesirable outputs: Empirical study on Malaysian water utilities' performance

摘要

Network Data Envelopment Analysis (NDEA) has been developed and empirically applied to cope the problem of standard or black-box DEA which ignored the interaction among its internal structure. Another variation of DEA models which inspired by Russell Graph Measure also has been widely extend based on the notion of Pareto-Koopmans efficiency. An advancement from these, called Network Russell model has been proposed to treat the network problem. We proposed a methodology to deal with undesirable outputs factor and incorporated it in the Network Russell model. The propose model is applied to measure the performance of water utilities sector. The results from the evaluation not only provide benchmarks and rank the efficient ones among the water utilities, but concurrently shows the optimal level the undesirable outputs can be reduced.