Measuring performance of two-stage network structures by DEA: A review and future perspective

Data envelopment analysis (DEA) is a method for measuring the efficiency of peer decision making units (DMUs). An important area of development in recent years has been devoted to applications wherein DMUs represent two-stage or network processes. One particular subset of such processes is those in which all the outputs from the first stage are the only inputs to the second stage. The current paper reviews these models and establishes relations among various approaches. We show that all the existing approaches can be categorized as using either Stackelberg (leader-follower), or cooperative game concepts. Future perspectives and challenges are discussed. (C) 2009 Elsevier Ltd. All rights reserved.