A valuation of the eco-efficiency using the DEA models – a double stages method

We show with using of illustrative example the functioning of the double-stage method for assessing eco-efficiency of firms, which produce not only a desired output, but also an undesirable output. This method is based on the traditional DEA model, namely the additive DEA models, which use the measure of efficiency based on slack variables. We explain why the traditional approach with the inclusion of an additional boundary (limiting polluting emissions) may not work properly and explain how to solve the problem mentioned double-stage method.