Original scientific paper
https://doi.org/10.17535/crorr.2027.0004
Stability region of marginal rates in the production possibility set
Mojtaba Ghiyasi
; Faculty of Industrial Engineering and Management Sciences, Shahrood University of Technology, Shahrood, Iran
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* Corresponding author.
Abstract
Marginal rate of substitution (MRS) and marginal rate of transformation (MRT) as two important concepts in the production economic. Variations in the levels of inputs or outputs can lead to changes in both MRS and MRT. As the quantities of resources used in production or the amounts of goods produced shift, the trade-offs that individuals or firms are willing or able to make also change. Consequently, these adjustments influence how one input or good is substituted for another, as well as how efficiently one output can be transformed into another. For the first time in the literature, the current paper provides a theoretical foundation for finding a stability region for MRS and MRT when inputs and outputs change using inverse data envelopment analysis (DEA). Proposed models are illustrated using three numerical examples are graphical illustrations. The contribution of this paper provide a useful tool for any real world study and input-output investigation and marginal rates (MRS and MRT).
Keywords
inverse DEA; marginal rate of substitution; marginal rate of transformation
Hrčak ID:
351142
URI
Publication date:
21.9.2026.
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