A Method for Calculating the Marginal Rate in the FDH Model

Document Type: Research Paper

Authors

1 Department of Mathematics, Lahijan Branch, Islamic Azad University, Lahijan, Iran

2 Department of Mathematics, Rasht Branch, Islamic Azad University, Rasht, Iran.

3 Department of Management, Rasht Branch, Islamic Azad University, Rasht, Iran

Abstract

Trade-off reviews the rate of marginal substitution of inputs and outputs onto the efficient frontier. On the other hand, marginal rates of substitution (MRS) are important quantities for analysts and managers. In this paper, by changing the method of Asmild (2004), an algorithm is found that it can be used to calculate the marginal rate of the free disposal hull (FDH) model.

Keywords