Environmental Assessment and Congestion for DMUs With Undesirable Outputs‎

In recent years, the assessment of environmental performance has been received considerable attention by environmental policy indicators and decision makers. In this regard, this paper applies data envelopment analysis (DEA) as a management tool for evaluating the environmental performance of the firms and uses the extended bounded adjusted measure (extended BAM) for including undesirable outputs in the environmental assessment. On the other hand, congestion points to a situation where inputs are excessively used. The previous studies of congestion mainly considered the framework of desirable outputs, and undesirable outputs have been disregarded in the evaluation. To overcome these shortcomings, this paper introduces an alternative definition and approach to treat congestion in the simultaneous presence of desirable and undesirable outputs. Then, the presented method is applied on 31 administrative regions of China. As a result of this application, it is observed that seven industries are environmentally efficient and also do not show congestion. Four industries evidence congestion in one or both of their inputs. By reducing the amount of congestion in each input, these industries can increase their desirable output and decrease their undesirable ‎outputs.‎