Productivity Change

In most of the analyses employed where DEA is applied, the need to assess productivity for a given period of time is often necessary. Since classical DEA formulations ignore the temporal dimension of data, new DEA formulations and relevant indices have been proposed. Among them, the most important is the Malmquist Productivity Index or MPI. This index calculates the productivity change of the DMUs between two consecutive years t and t + 1. Because of this, the data should also include the time information for each DMU’s inputs and outputs.