Cost efficiency measures in data envelopment analysis with data uncertainty

This paper extends the classical cost efficiency (CE) models to include data uncertainty. We believe that many research situations are best described by the intermediate case, where some uncertain input and output data are available. In such cases, the classical cost efficiency models cannot be used, because input and output data appear in the form of ranges. When the data are imprecise in the form of ranges, the cost efficiency measure calculated from the data should be uncertain as well. So, in the current paper, we develop a method for the estimation of upper and lower bounds for the cost efficiency measure in situations Of uncertain input and output data. Also, we develop the theory of efficiency measurement so as to accommodate incomplete price information by deriving upper and lower bounds for the cost efficiency measure. The practical application of these bounds is illustrated by a numerical example. (C) 2009 Elsevier B.V. All rights reserved.