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Ranking DMUs by Combining Cross-Efficiency Scores Based on Shannon’s Entropy

Department of Business Administration, Vanung University, Zhongli, Taoyuan 32061, Taiwan
Entropy 2019, 21(5), 467;
Received: 1 April 2019 / Revised: 30 April 2019 / Accepted: 2 May 2019 / Published: 4 May 2019
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Cross-efficiency evaluation is an effective approach for ranking decision-making units (DMUs), and there exist different perspectives from different cross-efficiency evaluation models. However, efficiency ranking results derived from cross-efficiency models may not be the same, and these models may provide some precious information that we cannot ignore. In this case, it may not be easy for one to decide which method should be used in some underlying assumptions, and we need several cross-efficiency evaluation models to measure simultaneously the cross-efficiency scores of DMUs. Hence, combining different viewpoints for ranking DMUs is a possible way to apply cross-efficiency evaluation. Since Shannon’s entropy is an effective tool to measure uncertainty, in this study we adopt the idea of Shannon’s entropy to combine cross-efficiency scores, which are obtained from different evaluation models, for comparison of DMUs. An example of commercial banks in Taiwan is used to illustrate the idea proposed in this paper. View Full-Text
Keywords: data envelopment analysis; cross efficiency; Shannon’s entropy; ranking data envelopment analysis; cross efficiency; Shannon’s entropy; ranking
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).

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Lee, Y.-C. Ranking DMUs by Combining Cross-Efficiency Scores Based on Shannon’s Entropy. Entropy 2019, 21, 467.

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