a new decomposition of cost efficiency based on the price and cost based production possibility sets in the case of different prices in data envelopment analysis

Identification of various sources of inefficiency plays an important role in the performance analysis aimed at developing plans for the improvement of decision making units ((dmus). in this regard, not only technical, cost (revenue and profit), and allocative efficiency can be estimated by information on inputs and outputs and their prices, but losses due to the lack of profit and revenue and optimal cost can also be calculated based on the relevant inefficiency. the present paper aimed at providing new estimates of cost efficiency (revenue and profit) and sources of losses in the total efficiency in a non-competitive environment where there is the possibility of change in prices of inputs and outputs from one dmu to another. in line with studies by tone (2002) and tone, tsutsui (2007), the present study sought to introduce new sources of inefficiency and related losses by presenting new price base production possibility sets (p-pps) and cost based production possibility sets (c-pps). accordingly, the efficiency introduced in studies by tone (2002) and tone, tsutsui (2007) is a special version of the proposed method.