A Distribution-Free Approach to Stochastic Efficiency Measurement with Inclusion of Expert Knowledge

Table 7

Qualitative information: determining the value for 𝛼.

Simulation 1; Largest % deviation from the expected level of performance of the  4 simulations	()𝛼∼1+0.112+0.2822∴𝜏+𝑘∼0.75𝛼=1.732
Simulation 2	()𝛼∼1+0.067+0.3122∴𝜏+𝑘∼0.74𝛼=1.687
Simulation 3; Smallest % deviation from the expected performance level of the  4 simulations	()𝛼∼1+0.118+0.1322∴𝜏+𝑘∼0.675𝛼=1.441
Simulation 4	()𝛼∼1+0.092+0.232∴𝜏+𝑘∼0.72𝛼=1.604

Note that in the simulations, the correction factor is set to 𝑘∼0.05 which implies that the user may have underestimated by 5%. Note that the value for 𝑘 can be zero. The values are calculated as the perceived inefficiency divided by the observed values.