Ranking of Farm Units Using Data Envelopment Analysis (DEA) Approach and Analytic Hierarchy Process (AHP): A Case Study of Sistan Region

Economic tendency of human always has been focused on getting maximum results with minimal facilities and factors; this can be called a tendency to achieve higher efficiency and productivity. This study aims at ranking farm units in Sistan region using integrated data envelopment analysis (DEA) approach and analytic hierarchy process AHP. Its data including fifteen farm units were gathered during the crop year of 2010-11. For the purpose of ranking these units, first, paired efficiency of each unit is calculated and then a matrix of the analytic hierarchy process is formed of paired comparisons for each efficiency value of the units and finally, the farm units are ranked. The study results of ranking in terms of efficiency show that the farms 1, 13 and 15 with technical efficiency value of 1 are placed in the highest rank and the farm 14 with the value of 0.213 is placed in the lowest rank. Furthermore, the results of ranking based on AHP suggest that the farm 1 with a weight of 0.09 is placed in the first rank and the farm 12 with a weight of 0.046 is placed in the last rank among farms in terms of efficiency. As shown by the findings, the farm units could not be appropriately ranked in the DEA method identifying only the ranks of efficient and inefficient groups. Therefore, a complete ranking requires a measurement of the relative productivity and the comparison of units in terms of some applied aspects such as AHP, controlling the inputs and outputs again to ensure their accuracy.
JEL Classification: CO2, C61
Keywords:
Ranking, Farm Unit, Data Envelopment Analysis (DEA), Analytic Hierarchy Process (AHP), Sistan