ENVIRONMENTAL DECISION MODELS WITH JOINT OUTPUTS

This paper critiques a recent attempt to model pollution prevention using data envelopment analysis (DEA). We contribute an alternative model which explicitly models joint provision of desirable and undesirable outputs (a la Shephard and Fare (1974)), using weak disposability of output. We also extend earlier work by Fare, Grosskopf, Lovell and Pasurka (1989) and Fare, Grosskopf and Pasurka (1986, 1989) to allow for expansion of desirable outputs and contraction of undesirable outputs at different rates.