chapter  3
Directional distance functions and dataenvelopment analysis
Pages 2

This section presents the theoretical framework of the environmental efficiency model of the study. First, the section brings the definition of the reference technology of the segment, that is, the generic form by which an input vector (input) is combined and transformed into a vector of new goods and services (output). This process is estimated by the set of production possibilities (SPP), which incorporates all the p outputs y 2 Rpþð Þ that can be produced with the input vector x 2 Rnþ

for k observed

decision-making units (DMUs). Formally, the SPP can be represented as shown in Equation (1).