Fuzzy Pairwise Dominance and Implications for Technical Efficiency Performance Assessment.

Classically, the concept of efficiency measurement is based on the definition of a frontier that envelops the observed production plans. The efficiency score itself is based on the distance of an observed production plan from this frontier. The frontier along with the required technological assumptions (such as convexity) needed for its definition may be replaced with the concept of pairwise dominance. This concept leads to a classification scheme for all production plans instead of a ranking based on efficiency scores. Also, the traditional assumption of deterministic or crisp production plans may be substituted with the weaker assumption or fuzzy production plans, as proposed by fuzzy set theory. This paper attempts to merge these two concepts and to define a new classification scheme based on fuzzy dominance.