Congestion and returns to scale in data envelopment analysis

Congestion indicates an economic state where inputs are overly invested. Evidence of congestion occurs whenever reducing some inputs can increase outputs. Return to scale is another related important economic implication of DEA efficiencies. In this research, we discuss together the problems of congestion, constant return to scale, increasing return to scale and decreasing return to scale by output oriented DEA models, (CR)-R-2 model, BC2 model, FG model, ST model, and a modified model. We identify the necessary and sufficient conditions for the evidence of congestion, constant, increasing and decreasing returns to scale. We show the exclusive relationships between the concepts of congestion and returns to scale. Numerical examples are provided for illustration. (C) 2002 Elsevier B.V. All rights reserved.