Luenberger-type indicators based on the weighted additive distance function

Abstract

This paper proposes two new Luenberger-type indicators, one for measuring productivity change of decision making units in the full input–output space, and the other for determining profit inefficiency change over time when information on market prices is also available. Both approaches are based upon the recently introduced weighted additive distance function, which permits the well-known weighted additive model in data envelopment analysis to be endowed with a distance function structure. We also show how the two indicators may be decomposed into their drivers.